The Biggest Economic Threat Today

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Kind heaven, no! A fresh economic scourge is upon the land. Announces CNN:

“New Threat to the Economy: Americans Are Saving Like It’s the 1980s.”

Is a higher evil possible? Thus we are informed:

Americans are slashing their spending, hoarding cash and shrinking their credit card debt as they fear their jobs could disappear during the coronavirus pandemic…

Although caution is a logical response to that uncertainty, hunkering down also poses a risk to the recovery in an economy dominated by consumer spending. A so-called V-shaped recovery can’t happen if consumers are sitting on the sidelines…

The savings rate in the United States climbed from 8% in February to 13.1% in March. That was the highest savings rate since November 1981.

The article further reminds us that consumer spending constitutes some 70% of the United States economy.

And so the old bugaboo rises from the grave yet again — the “paradox of thrift.”

The Evils of Saving

The individual saver may be the model of prudence, of frugality, of forbearance… of thrift itself.

But if the entire nation tied down its money?

A savage cycle would feed and feed upon itself… until the economy is devoured to the final crumbs.

Consumption would dwindle to near-nonexistence. GDP would collapse in a heap. Waves of bankruptcies would wash through.

All this because the selfishness of savers. They refuse to untie their purse strings… and spend for the greater good.

This paradox of thrift is perhaps the mother myth of economists in the Keynesian line.

Yet no paradox exists whatsoever.

Today we maintain — again — that saving is an unvarnished blessing, at all times, under all circumstances.

Let us first plunge a stake through the squirming heart of another myth:

The myth that consumer consumption constitutes 70% of the United States economy…

Lying Statistics

Much of what goes under the banner “consumer spending”… is not consumer spending.

It is government spending. Medicare and Medicaid, for example, are included.

Meantime, official GDP calculations do not include tremendous piles of economic doings.

These piles include business investment and spending on “intermediate” goods.

These of course are inputs required for the production of final goods — hence intermediate. They must first come in before consumer goods can go out.

The steel in the automobile, the sugar in the candy, the wood of the furniture… these are intermediate goods.

Consumer Spending Is Only 30% of GDP?

Yet their purchase does not classify as consumer spending — else they would be double-counted. Explains economist Mark Skousen:

GDP only measures the value of final output. It deliberately leaves out a big chunk of the economy — intermediate production or goods-in-process at the commodity, manufacturing and wholesale stages — to avoid double counting.

Now mix in expenditures on intermediate goods. What do we find?

We find that consumer consumption only constitutes perhaps 30% of GDP. Skousen:

I calculated total spending (sales or receipts) in the economy at all stages to be more than double GDP… By this measure — which I have dubbed gross domestic expenditures, or GDE — consumption represents only about 30% of the economy, while business investment (including intermediate output) represents over 50%.

We might add that Americans purchase heaps of foreign goods. These purchases add little to the gross domestic product.

Perhaps consumer spending accounts for less than 30% of GDP. We speculate of course. We have not interrogated the figures.

We now revisit our central claim — that saving is an unvarnished blessing, at all times, under all circumstances.

Remember Say’s Law

“From time immemorial proverbial wisdom has taught the virtues of saving,” wrote Henry Hazlitt 74 years ago, “and warned against the consequences of prodigality and waste.”

But to the anti-savers… prodigality and waste are near-virtues at times as these.

They have forgotten their Say’s law — perhaps purposefully.

Say’s law holds that supply creates its own demand. “Products are paid for with products,” argued Jean-Batiste Say over two centuries ago.

Production must precede consumption.

Here we return to an example we have previously cited…

The Baker and the Shoemaker

One man produces bread. Another produces shoes.

Let us say the baker bakes a baker’s dozen — 13 loaves of bread. He consumes two of them.

The remaining 11 loaves represent his savings. He can peddle them for other goods: shoes in our little example.

Meantime, the cobbler cobbles together 13 pairs of shoes. He requires one new pair for himself. He further sets aside two pairs for his growing children.

This fellow “consumes” three pairs of shoes, that is. The remaining ten constitute his savings. Like our baker, he can exchange his savings for goods.

To proceed…

Buying Is Actually a Form of Barter

The cobbler who requires bread for his dinner appears before the baker. And the baker who must clad his feet comes before the baker.

They may transact in money — direct barter is primitive. But upon closer examination we see their transactions in fact constitute an indirect barter.

Money merely throws an illusory veil across the transactions.

Ultimately the baker purchases his shoes with the bread he has baked. And the cobbler purchases his bread with the shoes he has cobbled.

That is, each has paid for his items through savings.

Concludes Monsieur Say:

Money performs but a momentary function in this double exchange; and when the transaction is finally closed, it will always be found that one kind of commodity has been exchanged for another.

What is more, the goods a man acquires through savings sees him through… and allows him to produce more loaves, more shoes.

We must conclude that there can be no excess of savings. Savings equal stored wealth.

To argue that savings injure society is to argue that wealth injures society.

And savings spring from production.

“Lack of Demand”

Yet the enemies of savings turn Say’s law upon its head. They sob not about a lack of production but a “lack of demand.”

That is, they place the wagon cart of consumption before the draft horse of production.

The government must race the printing press to make the shortage good, to furnish the lacking demand.

But no new production accompanies the flood of money. The additional money merely chases the existing stock of goods.

It is the pursuit of alchemy, of lead into gold, of the free lunch. It is the half-conscious belief that the print press is the spark plug of prosperity.

It neglects production.

“But what about times like these?” counter the author of the CNN article. “If everybody saved, the economy would collapse. Remember the paradox of thrift. If government doesn’t step in and spend, who will?”

But the old dead economists argue there is no paradox whatsoever…

No Paradox of Thrift

What applies to the individual applies to society at large, they insist. What is society but a collection of individuals, after all?

If saving during depressed times is such a vicious economic crime… how has any economy gotten back up?

The standard logic assumes all such economies corkscrew down and down into oblivion.

Yet as history demonstrates abundantly, they recover. As we have also explained before…

When society saves in lean times, it is not eliminating consumption — it is merely delaying it.

The demand that is supposedly lost is not lost at all. It is simply shifted toward the future.

Today’s savings are therefore tomorrow’s spending, tomorrow’s consumption. By reducing consumption today… society allows greater consumption tomorrow.

Or according to Hazlitt:

“‘Saving,’ in short, in the modern world, is only another form of spending.”

Perhaps someone can whisper those words into the ear of a certain CNN economics writer…


Brian Maher
Managing editor, The Daily Reckoning

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Shop and Save from the Comfort of Your Couch

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Dear Rich Lifer,

Some people love the hustle and bustle of the first big day of the holiday shopping season. They love to wake up early, pour a stiff cup of joe, grab their warmest jacket and head out before the crack of dawn to line up, camp out, and get the best deals and doorbusters on Black Friday.

Some people, though, are more inclined to sleep in, stay cozy, watch the big football game and enjoy the holiday weekend with their family. If that sounds like you, you might be worried that you’ll miss out on all the biggest sales, and that’s disappointing. After all, everyone wants to save money, right?

Not to worry, in the last few years, online shopping has skyrocketed… and retailers have noticed.

In fact, in 2018, online shopping alone brought in $6.8 Billion on Black Friday. Cyber Monday was no slouch either, bringing in a cool $7.8 Billion. These two days of online shopping showed an increase of 23% and 18% respectively over the prior year – and that’s not even counting any sales captured on the Saturday and Sunday in between!

With stats like these, it’s no wonder that retailers are paying attention. In an attempt to drive their Black Friday sales even higher, they’re following suit with fantastic deals online. After studying the trends of the past, I’ve compiled a list of the best ways for you to capitalize on those deals.

With these tips, you can save big from the comfort of your own home, read on!

Plan Ahead, Make A Budget, And Stick To It

Whether you’re shopping in-store or online, you need a plan if you want to stay in the black this holiday season. Write down who you’re shopping for, what they might like, how much you want to spend per person, and how much you intend to spend overall so you can stick close to your numbers. Believe or not, adhering to an Excel spreadsheet, or even a good old fashioned handwritten list can keep your expenditures in check. So figure out your numbers ahead of time, and the temptation to splurge will be much easier to avoid.

Know What You’re Looking For

If you’re still in the browsing and information gathering phase, start with the ads to see what items you can expect to see sale pricing on.

Check out sites like or to look at all the flyers in one place, and get on your favorite retailers’ email lists so you can get a general overview of what deals will be available come in the next few days.

Shop Safely

Not all websites are created equal, so listen to your intuition. If you’ve never heard of a site before, but they’re advertising an insanely good deal, make sure they’re legitimate with before you hit the “Buy Now” button.

Another thing you can look for is “https” in the web address. This means the site has SSL encryption – sites with an SSL certificate are much more secure than those without one.

Consider The Unlisted Benefits

While some sites will show a low price, they’ll make up for it with hefty shipping and handling charges. Make sure you’re comparing apples to apples by adding the item to cart and calculating all the costs before you commit.

Brush Up On Return Policies

Unfortunately, gifts don’t always go over the way you hope they will. Make sure you can get your money back for them after the fact if need be by researching the return policy ahead of time.

Luckily, many retailers now allow in-store returns for online purchases, so this part of the process is easier than ever before.

Use Credit Cards The Smart Way

If you’re using credit cards instead of your debit card this shopping season, why not double down on savings and use the cards with cash back? Just make sure you pay it off before interest charges hit to really take advantage of this benefit.

Want one more feature of shopping with credit cards? You can get points back, and if you shop through your card’s shopping portal (such as American Express’s Membership Rewards program), you can rake in even more bonuses. See what programs your credit card offers and map out how you can use them best.

Research With Online Tools

You don’t need to hit up site after site to find the best online deals. Instead, try the Google Shopping feature or services like Shopzilla, NexTag, and PriceGrabber to compare pricing quickly. This way, you’ll save time and money.

Collect Cash Back

When you’re shopping online, you can also get instant rebates with sites like Rakuten. During the majority of the year, Rakuten will give you rebates up to 10% at many retailers, but during special shopping periods, they give back even more. Best of all, there’s a Google Chrome browser extension for Rakuten that allows you to collect this cash back automatically every time you shop at one of the retailers in their program – no long process required!

Shop In Private Browser Windows

This is a next-level savings trick. When you’ve visited a site before, they know you’re already a fan. When you view the site in a private or incognito window, however, you’re more likely to get better coupons and first-time buyer specials.

Disabling your cookies has a similar effect, but that approach can cause inconveniences down the line, so pick the option that works better for you.

Sign Up On Social

Following your favorite retailers on Facebook, Twitter, and even Instagram is a good way to get special access coupon codes and limited time only offers. If you’re not into social media, you can always join their individual email lists instead – this is a great way to get coupons and special sales, too.

Give In To Instant Gratification

If you want to avoid the stress of shopping in-store, but you love the feeling of having your items right away, you’re in luck. Many retailers offer in-store pick up, so you can order online and then pick your items up same day – often with the same amazing deals you’d normally only get by waiting days to receive your purchases. Talk about win / win!

There you have it – 10+ ways you can stay home on Black Friday and still save big. With tips like these, you can have a happier, easier holiday season, so pick your favorites and have a good time shopping!

To a richer life,

Nilus Mattive

Nilus Mattive

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What Will You Save When You Cut the Cord?

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Dear Rich Lifer,

The so-called Golden Age of Television started back in the 1950s when TV sets began their explosive growth.

You might remember shows like I Love Lucy, Toast of the Town with host Ed Sullivan, and Gunsmoke.

These classics paved the way for networks to start adding even more content.

In the ‘60s, TV networks started showing full-length movies that had played in theatres. As the supply of movies started to dwindle the networks started producing their own “made-for-TV” movies.

Today, we’re going through another Golden Age of Television. Networks are investing billions of dollars into content creation.

Even large corporations like Amazon have their own movie and TV studios pumping out award-winning hits.

But with so much great TV comes ever increasing, expensive cable bills.

The Wall Street Journal recently cited data from Kagan, S&P Global Market Intelligence noting that the average cable customer pays more than $90 a month plus another $57 a month for high-speed internet.

Compare that to monthly streaming services from Amazon, Netflix and Hulu that tend to run between $9 a month up to $45 a month plus internet. It’s a no brainer.

You can even stream live TV and sports now for less than you pay for cable, plus there’s no commitment. Most services can be cancelled with the push of a button and you’re never tied to any lengthy contracts.

If you’re fed up with soaring cable bills and ridiculous monthly charges, it’s time to take the plunge and cut the cord.

Before I show you how easy it is to ditch your cable company, let’s cover some of the pros and cons first:

Pros of Cutting the Cord

  • The #1 pro is cost savings. You’ll typically save anywhere from $40 to $50 or more per month when you decide to cut the cord. Just think about all the things you could do with an extra $600…
  • Most live streaming services give you access to a free Cloud DVR (no more physical DVR box). This makes “taping” your favorite shows really convenient, which brings us to our last pro…
  • Most streaming services work on any device (laptop, tablet, smartphone, Kindle etc.) connected to the internet, which means you can watch TV anywhere. This is great for anyone who travels a lot, or has multiple residences throughout the year.

Cons of Cutting the Cord

  • Channel flipping can be slow. If you enjoy flipping through channels, you might not get that same satisfaction with streaming live TV or movies. It takes a few steps to change from one platform like Hulu Live to Netflix, Amazon and other streaming services. So if the ability to channel surf is worth an extra $50 a month, then hang 10, dude.
  • You’ll need a device like Roku or the Amazon Fire TV Stick to get streaming services. Unless you have a smart TV, you’ll need to buy a device that plugs into your TV and allows you to stream. The good news is these are cheap ($40-$50 one-time payment).
  • Some live TV streaming services have commercials you can’t fast forward. Hulu Live has a commercial option or commercial-free paid subscription. The commercial option will politely tell you how long ad breaks will last, so you can run to the bathroom or kitchen.

How to Cut the Cord in 5 Easy Steps

If you’re ready to cut the cord, here’s what you do:

  1. Decide if an antenna might work for live TV channels. You can dramatically cut costs by getting an antenna to tune into major broadcast stations like ABC, CBS and NBC as well as PBS. Antennas Direct’s ClearStream Eclipse and Antop’s Paper Thin Smartpass (they each sell for around $35 or $54) are good options for indoor antennas. You might also want to explore mounting an outdoor antenna if you live outside the city.
  2. Choose your internet provider. You probably have internet already, just make sure your internet speed is fast enough to handle multiple devices streaming at once. A good rule of thumb is 5 mbps for every streaming TV.
  3. Pick a device to perform streaming through your TV. Like I said earlier, your main options are Roku, Amazon Fire TV Stick, Chromecast and Apple TV. The first three cost about the same ($50 range), but Apple TV 4K runs a steep $179.
  4. Choose your streaming service for live TV. If you decide the antenna won’t work for live TV or you’re not picking up the programs you want, there are other live TV options. Hulu Live, DirectTV Now, Sling, YouTube TV and PlayStationVue are the most common. They’ll run you between $15 and $45 a month.
  5. Pick your streaming subscription apps. Amazon, Netflix, HBO, Showtime, Starz, Sundance Now, AMC and others offer a wide variety of original content. They all have apps and all you have to do is sign up for a subscription.

The costs of these apps vary widely: Netflix currently charges $8.99 a month for its base streaming plan, while premium channels like HBO run around $15 a month. Most subscriptions offer free trial periods with no commitment, I suggest trying different ones to see what you like.

To Cut the Cord or Not

The biggest mistake you can make is not giving this a try.

Once you take the leap and cancel your cable subscription, you’ll wonder why it took you so long — and if you want cable again, it’s not like your cable provider won’t take you back.

You’ll find that the savings are significant and you’ll have so many more options to choose from for a fraction of what you are currently paying.

You really have nothing to lose and everything to gain here. Cord cutting is not as scary as it sounds. Especially given all the options in this new Golden Age of Television.

To a richer life,

Nilus Mattive

Nilus Mattive

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11 Habits You Need to Break Before You’re Broke

This post 11 Habits You Need to Break Before You’re Broke appeared first on Daily Reckoning.

I’m all for treating myself to some of life’s luxuries, but I won’t splurge to the point where it starts to hurt my finances.

Sadly, for a lot of Americans the latter is true.

In fact, the average US adult spends $1,497 a month on nonessential items, according to a recent survey conducted by OnePoll. That’s roughly $18,000 a year on things we can all do without.

The survey revealed that the average person spends about $20 per month on coffee, as well as $209 on dinners at restaurants and $189 going out for drinks with friends.

Survey respondents said they spend an average of $91 per month for cable, in addition to $23 for streaming movies and TV shows. Music streaming services averaged $22 a month, while other apps added $23.

Even the cost of health club and gym memberships was significant, averaging $73 a month, including classes.

One interesting finding was that Amerians make an average of five impulse buys per month – for a total of $109. But, the irony is the majority (58 percent) feel there are other important things they can’t afford…hmm.

The truth of the matter is we all have bad spending habits we need to work on. Today I’m going to walk you through 11 of the worst spending habits that drive financial experts wild.

The good news is that all of these can easily be fixed…

Bad Habit #1: Keeping All Your Money in One Account

I’m always surprised when I hear someone say they only have one bank account. Physically separating your money is the easiest way to set and stick to a budget.

Here’s what you should be doing: 1) Rename your checking account your spending/depositing account. Tie this account to your debit card. 2) Open a second checking account and designate this one to your bills.

Calculate your average bill tally from the 1st to the 15th, and from the 16th to the end of the month, and transfer that amount to your bills account every two weeks. This will stop you from overspending on your debit card because you’ll have already covered your bills.

This two-account setup will save you a lot of time and money by automating your budgeting.

Bad Habit #2: You’re always searching for deals

This might sound counter-intuitive, but searching for sales can sometimes set you further back. Out of the top ten reasons cited for overspending, two include sales: discounted items or “one-time only” flash sales that typically lead to more spending. The expression, I can’t afford not to buy it, couldn’t be more true.

Bad Habit #3: Not Saving “Found” Money

Did a rebate you sent in months ago finally come in? Did someone buy you a coffee unexpectedly?

“Found” money often gets wasted. Anytime you find unexpected money, transfer that money to your savings or bill accounts. You’ll be surprised how much this adds up with minimal effort on your part.

Bad Habit #4: Having Too Many Subscriptions

You sign up for a one-month free trial and before you know it, you’ve gone 6 months without realizing you’ve been paying this whole time. Too many people pay for monthly subscriptions they never use.

Review your credit card statements monthly and highlight any subscriptions you’re not using anymore. Cancel these as soon as possible or mark the next renewal date on your calendar so you know when to cancel.

Bad Habit #5: Keeping Up with the “Smiths”

It used to be you were trying to keep up with the Joneses. Except back then, it was just your next-door neighbor. Now, in an era of social media and 24/7 news cycles, everyone is your neighbor when you turn on your phone.

Don’t subscribe to this keeping-up temptation. What you see being portrayed online is not always a true portrayal of someone’s day-to-day. Set realistic expectations for how your life should look.

Bad Habit #6: Being Too Passive

How many items of clothing in your closet do you own that still have tags on them? Returning items. Calling your cable company to get a better rate. Negotiating a bank fee. These things all take time and a little bit of effort. But it’s time and effort well spent.

A twenty-minute phone call with your internet provider, could save you $15 a month. Multiply those savings by 12 and you’ve saved $180 a year from one phone call. It’s tempting to take the path of least resistance when it comes to your money, don’t do it.

Bad Habit #7: Paying fees

Fees are something I won’t tolerate. Bank fees, ATM fees, maintenance fees, they all add up and they’re all negotiable. If you look at your bank statements and notice you’re paying a significant amount in fees, you need to stop this immediately.

Write down all the fees you’re paying on a regular basis and choose at least three to slash. You might have to threaten to switch providers or change banks, whatever you need to do to get the fee waived.

Bad Habit #8: Not Automating Your Bills

Everyone should be doing this nowadays. If you’re still getting bills in the mail, there’s a good chance you’re forgetting to pay those bills some months or your payments are late.

Use your bills checking account to pay your bills without having to think about it.

You’ll save the hassle of having to remember and you won’t have to worry about paying late fees and other penalties.

Bad Habit #9: Wasting Food

The number-one money-waster is throwing away leftover food. According to a recent study, part of the reason for this phenomenon is that people are bad at reading food labels. Food date labels like “best before” and “sell by” are largely unregulated in the US.

84% of consumers discard food near the package date at least occasionally, says the study. Among date labels assessed, “best if used by” was most frequently perceived as communicating quality, and both “expires on” and “use by” as communicating safety.

Over one third of participants incorrectly thought that date labeling was federally regulated, and 26% were unsure.

Bad Habit #10: Thinking a Budget Means “No”

When you think of the word “budget” what comes to mind? For most people, they think a budget means they have to say “no” to everything. You can’t save for a vacation, if you’re saying yes to brunch with your friends. You can’t save for a new car, if you’re saying yes to new clothes every month.

That’s not necessarily true. A budget doesn’t mean no, it just means you need to start prioritizing your money.

Think of a budget as a pecking order for where your money goes. Whatever is left after the important nuggets get covered can go toward the less important “non-essential” wants.

Bad Habit #11: Ignoring Your Daily Habits

And just because you have a monthly budget, doesn’t mean you’re necessarily aware of all your day-to-day expenditures. If you want to quickly assess your weekly spending habits, run a 10-day budget.

Notice how many small things you didn’t realize you needed to budget for. You want to do this once a quarter for a few reasons.

First, it helps alleviate the paycheck effect, where you get paid and then spend your full paycheck two weeks later. Second, you’ll pay attention to daily fluctuations in your spending and be able to make adjustments as you go.

To a richer life,

Nilus Mattive

Nilus Mattive

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Don’t Book Your Next Flight Until You Read This…

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Dear Rich Lifer,

We’re coming to the tail end of summer. For some that means the long awaited start of Autumn. For others of us, it means that it’s time to think about heading to a more tropical destination. I want to shine some light on common travel myths that are likely costing you more money than you think.

According to travel research app Hopper, domestic flight prices have a tendency to rise the closer you get to summer. So conversely, they tend to drop a little after the summer rush. That said, there are a lot of elements that influence into how much you pay for a plane ticket.  Flight search engines, last minute flash sales and regional pricing will all factor into how much you pay for travel.

But there are a few commonly held misconceptions about buying airfare that I want to debunk.

Myth #1 – Tuesday is the Best Day to Buy Plane Tickets

It’s true that prices can be more affordable on certain weekdays, but Tuesday is not the magic day anymore.

According to a report by Bloomberg that analyzed data from Hopper, the Tuesday rule only applies to 1.6% of domestic US flights, and only if you book right at midnight. Even if you complete the sale at 12 A.M. on the dot, you’re going to save just $18 on average.

Bigger discounts exist, but they’re more common for international flights. Nine hundred of the 3,500 global routes Hopper analyzed offered an average discount of $20 per ticket on Thursdays, and 600 slashed $30 off the price on Mondays.

If you’re looking to save on domestic flights, Thursday is your best bet. Hopper found that, on average, 3,500 out of 7,500 domestic routes lowered prices by $12 that day. On Wednesdays, 3,000 US routes offered a similar discount.

Myth #2 – Staying Through the Weekend Costs More

More often than not, this doesn’t hold true, new data from Hopper finds that with the exception of flights to the Caribbean, all other destinations have a discount with a Saturday night stay.

If you want to get the best savings, there are certain destinations that will save you more. Europe for example, the average discount is almost 40% when you include a Saturday night stay. Domestic and international flights to Canada, Mexico, Oceania and Central America offer discounts of less than 3%, says Hopper.

Why is it cheaper to include a Saturday night stay? According to the travel experts, this rule will always depend on whether weekend vs. weekdays is a reliable way to discriminate leisure from business travelers.

For US to Europe, it’s less common for someone to vacation mid-week without a Saturday stay, and vice versa, business travelers rarely want to stay over a weekend. This is why airlines charge business travelers more based on whether the trip includes a weekend.

But in other markets, like domestic US flights, that logic doesn’t work so well, and they can’t maintain a price discrepancy. To make things more complicated, places like the Caribbean, this rule is flipped — there’s more leisure demand with week-long trips being very popular, so airlines charge more for trips with a Saturday night.

Myth #3 – Layovers are Always Cheaper

Recent data released by Hopper finds that, on average, you save roughly 5% by choosing a direct flight. The research was true for about one in three flight queries.

“It comes down to who is competing in the market,” says Patrick Surry, Hopper’s chief data scientist.

“For example, if the only nonstop option is a major legacy carrier, then other carriers will discount their options with stops to a lower price to compete for the business. But in a market where it’s a low-cost carrier that serves the nonstop, it can often be the case that options with stops (on major carriers) are more expensive.”

One other way you can save on flights with layovers is called “hidden city ticketing.” It’s 100% legal but very frowned upon by most carriers.

How it works: If you want to travel between two major cities, say Chicago and New York, you could book a flight from Chicago to Burlington, Vermont, with a layover in New York, and skip the connecting flight.

A website called Skiplagged, actually helps users find these hidden city flights. They were even sued by United for how cheap the flights were…and they won. If you decide to try hidden city ticketing, only bring a carry-on and don’t book round trip.

Myth #4 – You Can’t Refund a Non-Refundable Ticket

I hate when this happens. You book a flight and a few hours later, panic strikes when you realize you booked the wrong dates. If the ticket was refundable, it’s no big deal but it’s almost always the case this happens when the ticket you bought is deemed non-refundable. What can you do?

Other than pay outrageous flight change fees, there’s actually a change/cancellation window built into all non-refundable tickets that is regulated by the US Department of Transportation. If you booked your ticket 7 or more days before your scheduled departure, the DOT mandates a free change or cancellation within a 24-hour period.

The catch is airlines don’t have to offer both options. They can choose whether they let you cancel or simply change your flight dates.

One final tip, when deciding when to book your flights, you can save money by choosing the optimal booking window.

Flights between 21 and 121 days before departure seems to be the sweet spot. If you book between 169-319 days ahead, you pay roughly $50 more, and waiting until the last minute can sometimes cost you closer to $200 more than the lowest fare.

I hope these help clear up some misconceptions about air travel.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

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The Secret to Acing an Interview After 50

This post The Secret to Acing an Interview After 50 appeared first on Daily Reckoning.

  • The biggest stumbling blocks to older workers are…
  • Avoid putting this red flag on your resume…
  • Nothing ages someone more in an interview than…

Dear Rich Lifer,

Finding work in your 50s or 60s is no easy task, but new and somewhat surprising employment data suggests that prospects are improving, especially for older job seekers.

One big reason?

This is the tightest labor market in nearly two decades, causing employers to look beyond the sea of Millennial candidates.

At the end of July, there were nearly 7.3 million unfilled jobs, but only 6.1 million people looking for work, according to the U.S. Department of Labor.

The unemployment rate in July for Americans 55 years and over was 2.7 percent, less than the overall unemployment rate at 3.7 percent.

What’s more encouraging is the average length of unemployment for older job seekers has dropped significantly since 2012.

It’s down from roughly 50 weeks to 34 weeks for job hunters age 55 to 64 and down from about 62 weeks to 30 weeks for those 65+.

In other words, it takes about seven to eight months on average to find a job if you’re over 55.

Stumbling Blocks for Those Over 50

Something I don’t think is given enough attention today are the unique challenges the over-50 crowd faces when looking for work.

Older applicants are competing with tech-savvy Millennials who often come at a cheaper price, and although age discrimination is technically illegal, it’s still pretty hard to enforce.

A study by the Government Accountability Office found five common barriers to employment for older workers:

High salary expectations — You may need to compromise on pay as your skills might not be as up to date as they once were.

Younger bosses — It’s human nature to want to work with people who are like you. If that’s the case, you need to learn how to address this obstacle in an interview.

Out of date skills — Technology is evolving faster than ever. Whether it’s applying for a job online or actually being able to operate new software, the pace can be overwhelming.

Expensive health benefits — The older you get, the more expensive your health premiums become. Bigger companies will be less impacted by this than smaller firms.

Bias — Old habits (and ideas) die hard. Know what biases you’re up against so you can get in front.

Acing the Interview

If it’s been a while since you were actively looking for work, you’ll notice certain aspects of the application and interview process has changed.

My hope today is to give you a few pointers on how to land your next gig, whether you’re coming off a layoff or looking for part-time work as a recent retiree.

If you follow these 10 tips, your inbox should be full of offer letters in the next few months.

Tip 1: Tap Your Network

A major benefit to having been in the workforce for so many years is your network of contacts. Don’t be shy to reach out to old bosses, co-workers, even subordinates.

Let them know you’re on the job hunt. Companies like referrals and it’s a lot easier to get your foot in the door if you know someone.

Tip 2: Get on LinkedIn

A quick way to tap your network is to connect with them on LinkedIn, the popular business-oriented social platform.

If you don’t have a LinkedIn profile, create one now. LinkedIn has become the go-to site for recruiters and hiring managers.

There’s plenty of good advice online that will walk you through how to build an attractive profile that will grab the attention of headhunters.

Bonus: just having a decent LinkedIn profile shows that you’re somewhat tech-savvy helping fight the ‘tech-illiterate’ label.

Tip 3: Update your Wardrobe

This might sound superficial but you need to dress for the job you want, and I don’t mean wearing a C-suite suit.

Your look should appear vibrant and modern. You don’t want to look dated because it’ll make the interviewer think that your skills are dated too.

The goal is to look age-appropriate yet current. Invest in a new suit, a slimmer fitted dress shirt, or a new pair of shoes. If you wear glasses, prioritize getting those updated first. Nothing ages someone more than an out-of-date pair of eyeglasses.

Tip 4: Update your Email Address

If you’re still using an old AOL or Hotmail account, you need to sign up for a newer email service. Get a Gmail or Outlook account to show you’re keeping up with the times.

It probably won’t win you a job, but it definitely won’t raise any red flags during the screening process either.

Also, check out Zoho and iCloud Mail, these are newer email services that’ll show you’re a little more tech-forward.

Tip 5: Modernize Your Resume

First, be sure to keep your resume to two pages max. Even if you’ve had a long and successful career, don’t bother listing every job you’ve held.

A good rule-of-thumb is to go back 10 to 15 years in your work history. This will also help disguise your age a bit should you be unfairly categorized. You can leave off the year you graduated from school, as well.

Be sure to include your LinkedIn profile URL and newly updated email address. If you have a landline, it’s best to leave it off and just use your cellphone.

These are minor details that will show a hiring manager you’re up to date.

Tip 6: Use Experience to Your Advantage

A major advantage you probably have over younger applicants is your experience, make sure you point that out and show how your expertise will help the company.

Don’t just tout your past though. Talk about the future and how you can mentor and groom the next generation of leaders in the company.

Tip 7: Show Adaptability

There’s a notion that older workers are typically going to be set in their ways. This is a common hurdle the over-50 job seeker must face. To fight this stereotype, you need to show that you’re adaptable to change.

When you speak to hiring managers, talk about situations where you adapted to change and the positive outcomes from doing so. Another way to show your flexibility is your willingness to take on temporary, part-time, or project-based work.

Employers understand that young job seekers want full-time jobs with benefits and security for their families. Older workers can fill the void especially for jobs that are seasonal or temporary by nature.

Tip 8: Keep up on Trends in Your Field

An easy way to impress hiring managers is to show that you’ve been keeping up in your field. To do this you can simply read industry newsletters, books, or watch videos online.

There are plenty of online courses you can take for further career development. Udemy, Lynda, and Coursera are all good places to start looking.

Tip 9: Highlight Your Tech Skills

You can’t get around it. In today’s workplace, you need to have a solid understanding of the technology used in your field. Find ways to weave the tech skills you have and are learning into the recruitment process.

For instance: instead of just saying you’re proficient in Excel, give a quick example of how you used Excel to filter large sets of data using pivot tables.

Tip 10: Show You’re High Energy

You want to give the impression that you’re ready to hit the ground running and not simply winding down for retirement. Terms like energetic, fast-paced, and looking for a new challenge are easy ways to liven up your resume.

No doubt, finding work as you get older becomes more challenging.

But that certainly doesn’t mean that you have less to offer than younger candidates. You just have to exert a little more effort to show that in your resume and during the interview process.
Stick to the basics and follow these 10 tips, it’ll help improve your odds of landing a job, or two.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post The Secret to Acing an Interview After 50 appeared first on Daily Reckoning.

Rake in Summer Savings the Lazy Way

This post Rake in Summer Savings the Lazy Way appeared first on Daily Reckoning.

Summer is here, and it is HOT.

Mind you, this week has been a bit of a reprieve from the oppressive heat, but last week was certainly a scorcher.

It got me thinking. 

When temperatures start rising, so do electric bills.

Obviously, where you live plays a big part in how much you end up paying on your monthly electricity bill.  Some places like Southern Louisiana for instance, have cheaper electricity, but scorching hot summers raise costs compared to more energy-expensive states like Northern California, where the climate is more temperate.

But no matter where you are, I have some tips that can help you save on your monthly bills.

The average US household spends about $112 a month on electricity according to the US Energy Information Administration. And a large portion of that is based on heating and cooling usage.

Is it worth moving to save a few bucks on electricity? Possibly.

Especially when you factor in “energy choice” states like Connecticut, Delaware, Washington D.C., Illinois, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, and Texas where you can negotiate cheaper contracts with providers.

But that’s a conversation for another day.

Today I’m giving you the lazy-man’s way to save on electricity.

No state hopping. No having to buy new energy-efficient appliances. No installing smart programmable thermostats. No extreme home makeovers to save a few hundred bucks on your electricity bill.


Because most of the big savings you’ll find on your monthly electricity bill don’t require a lot of money or investment.

These are my top 10 ways to save on electricity every month – the lazy way.

1. Fill the Cracks

Unless your home is brand new, there’s a good chance your windows and doors are leaking money.

Fill these cracks with caulk and weather-stripping to reduce drafts and your electric bill will drop dramatically.

According to Consumer Reports, sealing leaks in your home can reduce energy costs by 15 to 30%.

2. Use MAJAPs at Night

When it’s hot outside, avoid using your stove, washing machine, clothes dryer and dishwasher. All these major appliances (MAJAPs)  draw a lot of energy and typically produce heat.

This in turn causes your AC to work harder trying to maintain your home’s temperature. Also, depending on where you live, your electricity provider could offer reduced rates at different times of day.

Typically evening usage and weekends are cheaper than daytime during weekdays.

3. Use Ceiling Fans

Even if you have a central HVAC system, consider turning on your ceiling fans to help cool and heat rooms faster.

Fans push hot and cold air through your whole house so you can reach your room’s desired temperature a lot faster. Ceiling fans can save you up to $438 per year.

4. Wash Your Clothes in Cold Water

There’s no excuse for not washing the majority of your clothes in cold water.

Almost every detergent brand now dissolves just as well in cold as hot water at no additional cost and cold water proves to be less damaging to your fabrics.

Estimated savings for washing your clothes in cold water is around $150 per year.

5. Skip the Electric Dryer

If you have a yard and can set up a clothesline, do it.

But if space is limited or you’re worried about allergens, buy a few clothes drying racks off Amazon and hang dry heavier items like towels, jeans and sweatshirts.

Line-drying reduces average monthly electricity costs by $15.

6. Use a Slow Cooker

Avoid using your MAJAPs during the day but if you really want to cut costs, skip cooking in your oven altogether and use a crock pot or instant-pot.

Crock pots heat less of your house than traditional ovens and the best part is they require less work. Most crock pot meals are set it and forget it so you’ll save money and time using a slow cooker more often.

7. Reduce “Electricity Vampires”

Did you know 75% of the energy used by home electronics is consumed when they’re in standby?

These electricity vampires include TVs, computers, cable boxes, cellphone charging stations, and appliances – basically anything that holds a time or other settings.

Consumer Reports says that you can save $25 to $75 each year just killing these phantom electronics.

The easiest way to kill electricity vampires is to use power strips. Make it a habit of shutting off the strips between uses or buy a smart power strip that automatically shuts off when your electronics go in standby mode.

8. Turn Off Lights.

This one should be obvious.

Turning off lights you aren’t using or in rooms you’re not occupying saves a considerable amount of money every month.

Turning off a single 100-watt light bulb from running constantly saves around $131 per year.

If you really want to boost savings, switch all your lights to LED.

9. Raise/Lower the Temperature When You’re way

In the summer, raise your thermostat when you leave the house and in the winter lower it. There’s no sense cooling or heating an empty home.

Programmable thermostats are ideal for this but if you don’t have one, don’t think you have to go out and buy one.

Changing the temperature manually works fine too, it just takes more diligence.

10. Clean Air Filters Every 30 Days; Replace Every 3 Months

When your air filters are dirty your HVAC system has to work harder, which ends up costing you more money.

A good habit to get into is regularly cleaning and replacing your home’s air filters. Clean every 30 days and replace every 3 months is a good rule of thumb.

It might seem like your savings will be eaten up by the cost of replacement filters but that’s not the case.

Most people see savings from $20-$40 annually following this simple hack.

All of these hacks should add up to noticeable savings and don’t require much time or money.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post Rake in Summer Savings the Lazy Way appeared first on Daily Reckoning.

My Top 5 Tips to Save Money Using THIS

This post My Top 5 Tips to Save Money Using THIS appeared first on Daily Reckoning.

In corporate finance there’s a term used to describe inventory that sits in a warehouse costing the business money — that term is called carrying costs.

Imagine for a second that your house is run like a business and all your belongings are its inventory. The more stuff you own, the higher your carrying costs will be.

Of course, not everything you own will end up costing you money but you get the idea.

I believe minimalism is a sort of antidote to personal carrying costs.

Just like the costs of carrying excess inventory will eventually cripple a business, owning too much stuff will eventually wreak havoc on your state of mind and your wallet.

Today, I want to share a few principles from minimalism that will save you money.

What’s interesting about these five principles is they’re not about restricting your spending so much as changing what you decide to spend your money on that makes the difference.

Here are five minimalist principles that will fix your money problems:

1) Value Experiences Over Things

Minimalism is about focusing on what’s important to you. If you stop to really think about what you value most, you’ll realize it’s probably less about the materialistic things in your life and more about the experiences.

You remember the family vacations you took as a kid with your parents over the new suit you bought or the expensive watch that’s sitting in your dresser drawer.

Once you accept this reality, your spending shifts to align with these values. It’s no longer should I buy this new car or nicer pair of shoes. You’d rather save that money for your next big trip or outing with friends.

2) Understand Your Wants vs. Your Needs

It’s estimated that the average American household spends over 90% of their annual income. A big chunk of that spending goes toward things you don’t actually need.

Living minimally, forces you to identify what’s essential in your life and what’s excessive. A good exercise to do every month is review your credit card and bank statements.

Take out a pen and mark beside each line item whether it was a need or a want. If you do this every month, you’ll start to see patterns in your spending.

As you shift your spending to align with your values, you’ll see less wants show up. That’s not to say you shouldn’t spend your money on things you want though.

You’ll just have a clearer picture of the wants that actually add value to your life as opposed to the wants that are driven by laziness or gluttony. For example, eating out because you don’t want to cook versus going out for dinner with friends.

3) Buy Quality Over Quantity

If you’re always looking for the best deal on every purchase, you’re probably sacrificing quality.

Minimalism is less about trying to save a buck and more about buying quality things that last. Because in the long run you’ll spend less money owning fewer high-quality items than you will buying cheap stuff that constantly needs replacing.

Shoes are a great example. If you normally buy a pair of $30 running shoes, you might only get 6 months to a year out of them. If you were to spend 3x that amount, you’d get a shoe that will last you four to five times as long and are way more comfortable.

Minimalism helps you look at spending differently. Instead of getting the best deal today, it’s about finding a product that meets your needs and adds the most value to your life. Typically, this means shopping quality over quantity.

4) Less Things = More Space

As I said earlier, minimalism is the antidote to personal carrying costs. When you focus on downsizing your belongings, you see how much extra space you’re really paying for.

Approximately 1 in 10 Americans rent self-storage space, that’s almost 10% of the entire country that could be saving money if they followed this principle.

I’m not suggesting you move into a tiny house, but when you reduce your belongings you should consider what a move would save you long term if you were to give up a few hundred square feet.

5) Less Space = Less Maintenance Costs

Another benefit to owning less space and junk is it costs you less to maintain what you have. If you downsize from a four bedroom house to a two bedroom, your utilities will drop significantly.

And if you decide to sell one of your cars, your insurance, gas, and car repairs will all be halved.

Let’s Get Started!

There’s a reason businesses have entire accounting departments dedicated to reducing carrying costs. I recommend treating your home’s finances like you would a business. It may sound strange, but try it out!

As we’re about a week away from the month of August, now may be a good time to think about printing off your bank and credit card statements from the past month. Take a proactive step and ask yourself the tough question: what’s tying up my money today?

Then, once you have a clear picture of where your money is going, check to your spending patterns aligns with your values.  If they don’t, think about the things that you can cut.

Use this next month as a test.

Start small, don’t start with a big change like selling your car or house. Maybe start with cleaning out your closet and donating clothes that you forgot you owned. As you begin to adopt a more minimalist lifestyle, you may find you don’t need as much as you think.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post My Top 5 Tips to Save Money Using THIS appeared first on Daily Reckoning.

Over 50? The Important Investment you NEED to Make…

This post Over 50? The Important Investment you NEED to Make… appeared first on Daily Reckoning.

What do you call an investment that has no risk, requires little — if any — money to start, is available equally to the rich and poor, is proven to improve your career prospects…  can generate hundreds of thousands of dollars in savings over a lifetime?

I call it good health.

Although you might view spending on your health as a necessary expense, I’d argue it’s an investment that will pay back dividends.

Health is one of the least talked about financial topics but arguably the most important. 

Without good health, it doesn’t matter how much money you have in the bank because you won’t ever be able to enjoy it if you’re always sick.

According to The Wall Street Journal, the average individual will rack up $220,000 worth of health expenses in retirement.

It should come as no surprise, but getting old is not cheap.

There are, however, proven things you can do today that will help decrease your health costs tomorrow.

For instance, one study from the Johns Hopkins Bloomberg School of Public Health found that weight loss at any age leads to cost savings. The study found it costs people more when they’re overweight – especially as they age.

According to the study:

  • A 20-year-old adult who goes from obese to overweight would save an average of $17,655 in direct medical costs and productivity losses over their lifetime. If that person went from obese to a healthy weight, the savings would jump to $28,020.
  • If a 40-year-old adult goes from being obese to overweight, that person potentially can save an average of $18,262. If that person improves their health from obese to a healthy weight, an average savings of $31,447 in direct medical costs and productivity losses can follow.

Cost savings peak at age 50, according to the study. At 50, you save an average of $36,278. The study concluded by saying that at nearly any age there can be a cost savings if you improve your weight.

Aside from losing weight, what other aspects of your health can be improved to help your bank account?

I’ve identified three key areas you should focus on. Here they are…

#1 Start Eating Healthy

Harvard estimates it costs an extra $1.50 to eat healthy per day.

That’s an extra $550 per year.

The benefits of eating healthy are: reduced inflammation, a strong immune system to help fight off diseases and infection, lower Body Mass Index (BMI), which drastically reduces risks for Type 2 diabetes, heart disease, and fatty liver disease.

Actually, Type 2 diabetes is one of the most preventable diseases.

Type 1 is genetic and you’re typically diagnosed as a child or teenager. But Type 2 diabetes is heavily influenced by your lifestyle.

An estimated 30.3 million Americans have Type 2 diabetes. And it’s estimated that you spend 2.3x more on health care than someone without diabetes.

According to the CDC, the average cost of medical expenses for people with diagnosed diabetes is about $13,700 per year.

Let’s imagine you live with Type 2 diabetes for 30 years. From age 40 to age 70.

Without inflation, that’s $411,000 just to take care of your diabetes. And that doesn’t account for other health issues that will inevitably arise due to the stress placed on your body.

Now contrast that to spending an extra $1.50 per day on food and it’s a no brainer.

Eating healthy doesn’t have to be complicated either. There are plenty of proven healthy diets that work like the Mediterranean Diet and the Blue Zone Diet.

#2 Exercise More

Consider going on a “car diet.”

Look for opportunities to drive less. Walk, bike, take city transit. These will all save you money while incorporating some exercise.

Getting in quality exercise should not cost you very much. Forget about buying expensive running shoes, home exercise equipment, or boutique gym memberships.

The biggest investment will be your time. But even that shouldn’t cost you a lot. The CDC recommends 30 minutes of moderate activity, 5 days a week, for adults. The American Heart Association and the World Health Organization agree.

Where can you find 30 minutes in your day?

Go for a morning walk before you start your day. Walk at lunch to clear your head. The outdoors are free. Take advantage.

By eating healthy and exercising more, you’re investing in your long-term health. But another benefit to exercise and a healthy diet is it decreases the frequency you will get sick.

By not getting sick as often, you don’t have to miss work, using up sick days or unpaid days if you’re out. You’ll have more energy to take care of your grandkids, and you lower your medical bills like prescriptions and over-the-counter drugs.

#3 Eliminate Your Vices

This should go without saying but I’ll repeat it. You must eliminate any unhealthy habits that are costing you health and money.

An obvious culprit is cigarettes.

If you smoke, you’re literally burning money and years off your life. According to the CDC, the average cost of a pack of cigarettes is $6.28, which means a pack-a-day habit sets you back $188 per month or $2,292 per year. Ten years of smoking comes with a $22,920 price tag.

Another prime target are sugary drinks like Coca-Cola and calorie-loaded Starbucks drinks. Not only is it cheaper to drink water or regular coffee, you’ll be less likely to develop diabetes and other health-related issues.

By no means is quitting smoking or sugary beverages easy. But you need to try different approaches and figure out what works because you can’t keep hurting this up.

Your health should be part of your investment portfolio if it’s already not. It doesn’t matter if you’re conservative, modest, or you’re aggressive in your approach, what matters is you prioritize your health so you can live a truly wealthy life.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post Over 50? The Important Investment you NEED to Make… appeared first on Daily Reckoning.

How to Tell If You’re Frugal or Just Cheap

This post How to Tell If You’re Frugal or Just Cheap appeared first on Daily Reckoning.

Billionaire investor Warren Buffett is often labeled frugal.

He lives in the same house he bought back in 1958 for $31,500.

He never spends more than $3.17 on breakfast, and up until 2014, was driving the same 2006 Cadillac DTS.

It wasn’t until his daughter told him it was embarrassing that he traded up for the new XTS model.

Contrast Buffett’s frugal lifestyle to this story shared on Reddit a few months ago:

RE: What’s the cheapest/stingiest thing you’ve seen someone do?

My grandmother, as she didn’t own a computer, had to mail in all her bill payments. One month she didn’t get her water bill or it was delivered to someone else by accident. Whatever the cause, her next bill was for both that month and the previous month and included a late fee that was less than the cost of a stamp.

For the rest of her life she skipped the bill one month and then paid both the next because she saved a few cents by using just one stamp instead of two. This was a woman who had somewhere around a million dollars in the bank when she died.

There’s a fine line between frugal and cheap. And I’ll be the first to admit I sometimes toe that line. But for many Americans, frugality is a necessity.

Credit card and student loan debt are at the highest they’ve ever been. On top of that, inflation seems to be outpacing wage growth.

These factors make minimizing spending and reducing expenses that much more critical to the average household.

Nevertheless, it’s easy to take frugality too far. Here are a few telltale signs that you’ve crossed over from being frugal to just plain cheap:

Leaving a Bad Tip or No Tip At All

You know you’re cheap when you go to a restaurant and don’t leave your server a tip. If you think, “well, I’ve already paid for the meal therefore I shouldn’t have to tip,” you’re justifying your cheapness.

Waitstaff rely on tips as part of their income. Legally, they can be paid as little as $2.13 an hour plus tips. If the tips aren’t enough to bring their earnings up to the federal minimum wage of $7.25 an hour, their employers must add enough to make up the difference, but no more.

Instead of stiff-ing your server, you can save money by eating at a buffet or restaurant where you serve yourself. Or, you can save money by picking up your order rather than having it delivered or dining in.

Cheapos Buy-and-Return Shop

Another sign you’re cheap is if you buy-and-return shop. This is when you buy an outfit for a special event, you leave the tags on, wear it and then return it the next day to get your money back.

I’ve seen my cheap friends do this with appliances and power tools they needed for a season or one-off jobs. It’s not cool. Typically, what happens to these returned goods are the stores have to sell them at a discount since they’re no longer new, or they get scraped, adding to the waste in our landfills.

If you can’t afford to buy new, consider shopping at consignment stores or find used tools on ebay or Craigslist.

Rebate Double-Dipping

If you’re buying a product with a $25 mail-in rebate and you think it’s a great deal, you might be tempted to buy two. However, at the bottom of the coupon it usually says one rebate per household.

To get around this, you fill out a second form using a different mailing address, like a PO box. Legally speaking, this is a form of fraud – and since you’re using the postal system to do it, it can be prosecuted as mail fraud.

But even if you don’t get caught, you’re still being extremely cheap and it’s unfair to the manufacturer.

Instead of trying to double-dip your rebates, look for ways you can stack them. For instance, use a discounted gift card to make a purchase using the rebate code. This way, you save on the gift card plus you get the savings from the rebate.

Stealing Supplies

Your boss might not pay you enough, but that doesn’t mean you can pilfer pens, paper, markers, or sticky notes. Sure, these small office supplies might not seem like a big deal but it’s still theft.

The same goes for condiments at restaurants. If you’re stuffing your purse or wallet with ketchup, mustard, sugar or jam packets, you’re not being frugal, you’re being cheap.

This kind of petty theft hurts companies over time. Your company bought those supplies for office workers to use at the office, and taking them home costs the company money – which in turn leaves less money in the budget to pay you what you really deserve.

Similarly, restaurants have to cover the cost of all those condiment packets by raising their menu prices.


There’s an art to regifting and it really boils down to thoughtfulness. If your budget is tight and you decide to regift, don’t gift someone you love something they’ve either given you as a gift or have seen you around using it.

Secondhand gifts don’t always have to be your own. If you find a nice cashmere sweater or leather jacket at a thrift store, your brother or sister won’t care if you paid $10 or $150 for it if it’s been something they’ve always wanted. It’s the thought that counts.

The Bottom Line

There’s a fine line between cheap and frugal. If you find yourself crossing over to the cheap side, think of who your cheapness is affecting. You might be saving a few dollars by being cheap, but you risk hurting your relationships and your own savings in the long run if you continue to be stingy.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post How to Tell If You’re Frugal or Just Cheap appeared first on Daily Reckoning.