A unique way to save money...
It’s easy to be committed to saving money when you realize that;
A). You have no money
B). You can’t pay your bills
C). Your spouse will kill you when he/she finds out how much you’ve spent on that new purse/ power tool.
But after these moments come and pass, most of us fall back into our comfortable habits of spending money here and there on things we really don’t need, and after a while we wonder why we don’t have as much in that savings account as we thought we were going to.
What we need is to be reminded, constantly, to save money. The way I’ve found to do this is write two simple words down on many, many pieces of paper. Those words are; Save Money.
Neuro-Repetition
It may sound silly, but in the past I have taken scraps of paper, written those words on them, and taped them everywhere. And I mean everywhere, on the fridge, on my nightstand, in my daily planner, on my desk at work, in my textbooks…even on the steering wheel of my car!
After several days of seeing this phrase everywhere, it was firmly stuck in my head. I found myself saying these words over and over in my head, not even realizing I was doing it (I call it Neuro-Repetition… yeah I know, I just created my own medical term… what a nerd, right?).
And then when it came time to open my wallet and spend money, it was almost impossible. It’s like those two words became a part of my being, and to go against them felt like a crime against nature.
No, I’m Not Entirely Crazy
There is actually some science behind this, based in something called neuroplasticity. Basically that means that scientists now think that the brain is a much more dynamic, flexible organ than was once believed, able to change and adapt based on what information we absorb and what we learn.
By reading those two words over and over, I had in a sense re-wired my brain to, well, save money. It’s the same concept that was used in a Harvard study a few years ago.
In the study, there were two groups of people. One group spent time imagining that they were playing a keyboard while looking at sheet music; the other group actually played the keyboard. The brains of the people in both groups were scanned before and after the experiment.
As the scientists expected, there was obvious growth in the section of the brain that controls the fingers in the group that actually played. What wasn’t expected however was the discovery that in those who only imagined playing, their brains responded in the same exact way, without ever playing a note.
In essence, the second group changed their brain just by thinking it.
So let’s think (no pun intended) about the implications. While not as easy as I may be making it sound, one could conceivably change the way they think and act, as long as they concentrate long and hard on it, practice it, get it in their heads (so to speak), and imagine themselves actually acting and behaving the way they want to, over and over again, repeatedly, until it literately becomes a part of themselves.
If nothing else, this technique will at least get you thinking about saving that money.
About a month or so ago I wrote a post about how Ally’s online savings accounts work, which can be found here. At the end of that post I said I would post an update, so here it is.
When I last wrote about Ally.com, I had decided to open up just one online savings account and name it Car Maintenance. The money transferred into this account on a monthly basis from my regular bank is earmarked for, you guessed it, anything having to do with maintaining my car, including oil changes, new tires, and any other type of unexpected repairs.
Now however, not only do I have that one account, but I’ve added 3 others, titled College Books, Tuition, and Gifts. Basically I estimated how much per year I spent in each of these categories, divided that number by 12, and set up an automated direct deposit that transfers the amounts I decided on once a month.
New Spin on an Existing Concept
This brings me to a new spin on a concept that has been around for a while called the envelope system. This is a system that Dave Ramsey espouses on his radio talk show and in his books. Essentially, one is supposed to have a plain old paper envelope for every type of bill, especially those Discretionary Bills, filled with a certain amount of money. Once that amount of money is gone, then that’s it for the remainder of the month.
I’ve used the envelope system once before, but the problem I kept running into was when one of the envelopes was empty, I developed the bad habit of simply taking money from another envelope, which pretty much defeats the purpose of the system.
With Ally however, one has the ability to create an Electronic Envelope System, which makes it much more difficult to simply grab a $20 from another envelope and use it for something other than it was intended for. Plus it’s nice not to have to keep track of loose change.
Ease of Use
Using the money in these online savings accounts is quite easy as well. In fact, just the other day I had the oil in my car changed. All I did was pay for it using my debit card that was linked to my regular bank account, I kept the receipt, and when I got home I transferred the exact amount from my Car Maintenance fund at ally.com to my bank account. Simple as that.
Some of you may have realized that I haven’t kept Dollar Commentary as updated as I could have lately. Well, I’ll let you in on a little secret as to why that is… it has to do with making money.
How successful do you act?
I won’t lie…
When I started this blog I entertained ideas of making some money off of it (I still do in fact). I had dollar signs in my eyes, so to speak. But the more I was reading about making money blogging, the more I realized how unlikely it would be, until I became more and more discouraged, finally putting off the writing of content altogether.
Then just the other day a thought occurred to me, something rather simple but slightly profound. That thought was this; if I put all of my effort into developing my blog, if I stuck with it with religious fervor, not listening to any nay-sayers and forsaking my daily allotment of television viewing and socializing, then…my blog still might not become a success.
However, if I just quit now, fearing the possibility of not succeeding, then my blog will have become, beyond a shadow of a doubt, a mega, colossal failure.
Sure, success in anything requires more than just persistence; it requires things like hard work, a dose of talent, and even a dash of luck from time to time.
But to quit something just because of the possibility that it might fail seems to me now almost like a form of cowardice.
Ironically…
This strikes me as funny actually, because I consider myself pretty versed in what it takes to be successful. I’ve read the books, listened to the speakers, and downloaded the podcasts. It seems however that there is still a leap to be made from knowing what it takes to be successful, and actually applying that knowledge in your actions.
So my challenge to all of you out there is this; examine what you think you know and believe about success.
Then examine if those beliefs you say you have are readily apparent in your life. If not, then think about what you can do to reconcile the rift between belief and action.
The New York Times Square branch of Bank of America
Bank of America announced yesterday that they would begin to repay the $45 billion in bailout money they received from the government (which in turn came from us taxpayers), over the course of the next few days.
Bank of America on Bailout
It’s Bank of America’s motives for doing this that was the most uplifting thing about this piece of news for me. See, while they held that government money, Bank of America was subject to many regulations and restrictions, one of which being a cap on the pay of any CEO they may potentially hire.
Current Bank of America CEO, Ken Lewis
The result- they can’t find a CEO. Their current CEO will retire on December 31st, and they don’t have a replacement.
Bank of America believes that by repaying this money, they will be free of the government regulations, and that may help them find a CEO.
And it’s not like Bank of America just has the money lying around to do this either, in fact, they have to raise 18.8 billion dollars to pay off the government money in full.
What I’m Taking Away From This
Companies who have received TARP funds have a certain stigma about them. The American people and other business men and women want nothing to do with a company who in essence allowed the taxpayer to swoop in and save them.
Why else would their stock rise at this news? Because Bank of America is in a better financial situation than they used to be? Yes, they have recovered somewhat, but they’re still raising 18.8 billion to do this, and that’s not exactly a small amount of change.
My Prediction
Soon after this government money is paid back in full, they will find another quality CEO, and not just because the deadline is looming larger every day.
Okay, so I’m just gonna come out and say it- I’m a nerd.
Of course, I do bathe daily, unlike most nerds. And I exercise nearly every day of the week, which is something hardcore nerds seem to be allergic to.
But when a movie like the new Star Trek directed by J.J. Abrams promotes me to write a post about what Star Trek can teach us about our finances, simply because I want to in some way relate a post to Star Trek…I consider myself a nerd.
All kidding aside, Star Trek is chock-full of worthwhile themes and concepts that translate into beneficial thought concerning what we do with our money.
Considering that the planet Earth of Star Trek times has eliminated war and disease completely, they may be on to something.
Warp Drive is...really fast
Warp Drive…and Debt?
Consider the forms of propulsion throughout history; walking, animals pulling wagons, sails attached to ships moved by wind, the steam engine, the internal combustion engine, the rockets of the space age… all of these seem rather primitive compared to an engine that propels things faster than the speed of light.
Consider the beginning stages of your investments or debt elimination as those early forms of propulsion. They may not seem like much, and none of them will ever get you as far as warp drive could, but all of them have been necessary to obtain warp drive.
Over time those early steps will grow until one day you’ll look back and be amazed at how far you have come.
If we never figured out how to build a simple rocket, how could we possibly travel faster than light?
This was unheard of on television at the time
Everybody’s Welcome!
In the days of the original Star Trek (1966-1969), one of the unique things about the show was that diversity was encouraged and promoted, evidenced by the fact that the crew of the Enterprise consisted of both men and women, in equal positions of authority, enjoying equal opportunities for advancement and recognition.
Additionally shocking was the fact that one of those females was black.
Oh, and did I mention that whole species that haven’t even had a chance to be discriminated against yet, namely aliens from other planets, were treated just as fairly?
The point here is that in order to get rid of debt, build wealth, and achieve financial independence, all of your old ways of thinking need to be at least examined, if not completely reworked. You’ll have to let go of old discriminations and assumptions that have kept you from achieving your financial goals and instead develop and cultivate new behavior that is more conducive to your aspirations.
Seems pretty comfortable in that chair, doesn't he?
“I don’t believe in the no-win scenario”
In the new Star Trek film, an argument between Spock and Kirk occurs, concerning a test designed to determine how cadets respond to a situation in which there is no way to win. James Kirk responds with the dramatic and defiant line, “I don’t believe in the no-win scenario”.
Sometimes when it comes to our finances, we must also have this stubborn perspective. We must be able to blindly, on nothing more than faith, believe that we will be able to climb out of the deep, dark hole of debt, and one day rise to the point where we can be financially independent.
This will probably be one of the harder things to do; after all, we’ve lived our entire lives believing that those rare, uber-rich individuals are almost freaks of nature, that no common hard-working person could ever come close to that sort of success. Society itself tells us this often enough.
Just by believing 100% that it’s possible is at least half the battle. All that’s left at that point is to just take the steps to get there.
Continuing our series that showcases 28 major principles the founding fathers adhered to when founding America is founding principle #3: Virtuous and Moral Leaders (and their salaries). Adapted from The 5000 Year Leap.
Founding Principle #3: Virtuous and Moral Leaders (and their salaries)
This one seems pretty obvious, but the founders believed that having good leaders will ensure the continuation of the republic. Go figure.
The founders had a lot to say about what constitutes a good leader however. Their idea of a leader was more of a public servant-type figure, sacrificing much of their own life in order to properly serve the public.
This guy, George Washington, refused his salary while Commander in Chief of the Army.
What, no Money?
In fact, political positions were not meant to provide high salaries whatsoever, they were originally intended to pay a modest amount that covered the necessities, so as not to create a reason for seeking a political position other than to serve the public, such as the church does with its priests. It was an attempt to keep the public officials objective.
That didn’t last long obviously.
Could this really happen in America?
I’ve been reading a book. One written over fifty years ago, which consists of more than 1000 pages (full of very, very small print, I might add). I share this with you not to toot my own literary horn, but to illustrate that even though the things I just said are true, this particular book has enjoyed a massive surge of profitability at bookstores nation-wide recently.
The book is titled Atlas Shrugged, by Ayn Rand.
Okay, So Why did Atlas Shrug?
Long, deep story short; it’s about an America that has lost ambition, that attacks entrepreneurs, and demonizes anyone who thinks of their own benefit and profit over the general welfare of all society. More specifically, it follows the actions of various successful industrial CEOs that fight the good fight against big government, anti-business legislation, and society’s overall belief that hording wealth and success for yourself is the very definition of immorality.
Eerie Predictions?
The reason I bring this book up is that, aside from it simply being an entertaining book, many of its 52 year-old themes are becoming eerily relevant in today’s America. Socialized industries, distribution of wealth, financial help for those who don’t deserve it and do nothing to better their situation… all of these things were written about 52 years ago, and each one of them is happening today, in our society right now.
Rand’s Future America
Let me shed a little more light on the America Ms. Rand has created in her book; it’s dirty. It’s poor.
The feeling one receives from reading this book is of a country completely past its prime, its greatest glories and achievements lost to legend, many even choosing to believe they are legends, that nothing magnificent could ever actually happen anywhere on Earth.
The rhetoric of the common person focuses on the fact that circumstances are not their fault, that there could be no way for them to be personally blamed for any of their problems. It’s always someone else’s fault for the members of Rand’s fictitious, but potential, America.
Gone are the notions of personal responsibility, hard work, individual rights, and the entrepreneurial spirit that once made America so grand, replaced with progressive notions that have done nothing but slowly bring down American success and prosperity to the level of its lowest citizens, so that no one is possessing of an “unfair” amount of wealth or luxury.
The very spirits of Rand’s Americans are defeated, depressed, and simply pathetic.
Apathy is Deadly
The thing that makes this book compelling and oddly scary is this; a government, viewed as a single entity, can be brought down, can be rebelled against, but only if it’s people are willing… but what happens if what you’re fighting against is a society that has accepted its situation, that has lost all passion, convictions, and drive…a society that is willing to slip away into obscurity?
Ayn Rand has been right about things in the past, such as the decline of communism, which occurred after her death. She’s currently right about many of the social issues of our day, despite being dead for 27 years… will she one day be right about the state of the future America and the spirit of its citizens?
And I haven’t even finished the book quite yet.
http://www.aynrand.org/site/PageServer?pagename=index
http://www.bloomberg.com/apps/news?pid=20601039&sid=ar2de0RP4ebo
http://www.businessweek.com/debateroom/archives/2009/04/the_economy_nee_1.html (a very short debate on the economical implications of Rand’s work)
So I was driving my Honda the other day when my right rear tire blew out, resulting in the purchase of 2 new tires (the other rear one had a low amount of tread). This got me thinking about how I wish I had some money set aside specifically for car repairs. Yes, I had money set aside, but in a sort of multi-purpose slush fund type deal, which got me thinking about individual savings accounts.
I had heard good things about Ally’s online savings accounts from a few friends, so I decided to open one up, name it ‘Car Maintenance’, and transfer a certain amount of money a month into it solely for car repairs. In fact, once it was all set up it took me less than 3 minutes to schedule recurring monthly deposits, with weekly, bi-weekly, monthly, two months, quarterly, four months, and twice a year options.
No minimum balance is required and there’s no type of fee for opening an account, nor any monthly fees. This being a federally-backed, FDIC-insured savings account means you’re limited to 6 withdraws per statement cycle, which is no problem considering what I’m using the account for. For every withdraw over 6, a $10 fee is imposed.
The Fine Print…
The process was very simple and straightforward. I went to www.ally.com, clicked on the ‘open account’ button on the left-hand side, clicked the ‘new customer’ button, and filled out my information. I was able to specify right away the amount of money I wanted transferred over from my checking account, and that was that.
All That’s Left
The only other thing I had to do was verify my checking account. Ally does this by depositing amounts less than a dollar in your checking account within a few days, and then requiring the account holder to provide those exact amounts to Ally, thus proving that you own the account. Or that you at least have access to it. There is also a postal method of verifying your account.
The main reason for me opening an online savings account was really only to keep it separate from my checking account. The bank I’m with doesn’t allow multiple accounts or the dividing up and segregating of a single account. The interest rate is a nice bonus, at 1.57%. Not the absolute highest rate you can find on the internet, but my goal wasn’t really to find the highest rate.
I found the entire process and the website itself refreshingly uncluttered and to-the-point. In fact, I’m already considering opening more accounts with specific purposes and setting up monthly transfers, maybe one for a down payment on a house. To me it seems to provide a certain peace of mind, being able to look at one account, knowing every dime in there goes to one thing.
I’ll post some updates after owning the account for a while letting you all know of any other discoveries or issues with Ally.
Founding Principle # 2: Only a Virtuous, Morally Strong People are Capable of Freedom
Continuing our series that showcases 28 major principles the founding fathers adhered to when founding America is founding principle #2: only a virtuous, morally strong people are capable of freedom. Adapted from The 5000 Year Leap.
Founding Principle # 2: Only a Virtuous, Morally Strong People are Capable of Freedom
To understand this principle, you’ll have to consider the fact that the majority of the citizens of a country need to possess strong morals and a virtuous nature to remain free. This makes sense considering the officials who are in power are elected by the people. If the citizens are corrupt and devoid of morals, then what problem would they have with electing people who have the same types of beliefs?
Probably the largest difference between the Americans of 1776 and the Americans of today is that the original Americans doubted whether they could sustain a self-governed nation, they doubted their capacity to remain moral and virtuous. Today that doubt is not considered by the general population.
Being involved, taking a stand, and having an opinion was considered a moral duty by the founding fathers
Their Definition
In their definition of being moral and virtuous, the founding fathers included things such as being involved in your government, staying informed on current events, possessing a sense of patriotism and community, and a commitment to liberty.
The founding fathers also had what seemed to be a curious fear of British extravagance and luxury, believing that if these things took hold in the colonies, then the industrious and virtuous nature of the American settlers would be in grave danger.
I wanted to take a moment out of this morning with my family to wish everybody a happy thanksgiving! It’s easy throughout the weeks and months of worrying about the economy and your individual financial situation to forget about the things that really matter and what we’re truly thankful for.
I’m thankful for all the readers out there, as well as my family and friends that support me and put up with all of my quirks and the…uniqueness of my personality. I’m also very thankful for the fact I have a stable job that more than pays for the things I need, as well as a few things I just simply want from time to time.
Anyway, if you’re reading this right now, get back to your loved ones, and Happy Thanksgiving!
