Okay, a little shorter post today with the holiday weekend and all. I do not want to make anyone think too hard but I was reminded recently that “frugal” does not always mean “cheaper”. My wife and I sometimes review some of the purchases that we have made over our lives where we spent little money, but wish we had spent a little more.

Vacuum

My wife and I will have been married for eight years in July and we are on our fourth vacuum. One of the vacuums was given to us, but we spent an average of $60 on the other three - and most likely we will be buying another in a year or two. I often wish we had gone out and gotten the best vacuum that we could afford when we were first married. We certainly could have purchased a $150 or $200 model. I am confident that had we done so, we would still be using that vacuum today and it probably would last another ten years. Now we are in a life situation where we cannot spend that much. Until our financial situation improves, we will have to buy cheap.

This is many times the case with appliances, my Grandmother is still using the blender that was given to her at her wedding - over 60 years ago. My dad used a shop vac on his cars for over twenty-five years. Sometimes quality is worth a couple extra bucks.

Laundry machines

Growing up, my mother used a ringer-washer, both the hand-crank and the electric kind. I remember watching her feed cloth diaper after cloth diaper through that think until her hands were cracked and bleeding from the water. We all remember the day that my dad brought home a Maytag automatic washing machine. He saved up his money and purchased one of the best available. That washer was used virtually ever day for almost thirty years. Five kids will push any appliance to the limit. My father could have paid twice as much for that washer and gotten his money’s worth.

Kitchen knives

Once again, my father is one of the most frugal people I know. He supported our family on a miniscule salary for most of our lives, but when he bought, he bought quality. When I was home a couple of weeks ago, I realized that my mother is still using the cutlery set that my dad purchased for her when I was six years old.

Shoes

I have found that it does not pay to get cheap shoes. Many times in my life, I have thought I could get away with buying the off-brand, but soon realized that it was a mistake. I once had a pair of off-brand shoes in which the insole completely disintigrated in a matter of days. Most cheap shoes do not fit right - I have had some that have even caused health problems like shin splints, hip soreness and back problems. Shop the sales, try to get money off, but I recommend good shoes - even if they costs a few more bucks.

Mattresses and pillows

Just before my wife and I were married, I knew we needed a mattress and box spring set so I searched through the classifieds and perused the ads until I found the most inexpensive queen mattress and box spring set that I could find. What a dumb thing to do! About three years into our marriage, I knew I had made a mistake. The next time we get a new mattress (hopefully soon), we are going to get a good one.

Our pillows were also an area where we thought we could get away cheap. We just went down to the nearest big box store and got the cheapest pillow possible. I think our first pair cost $7. We are slow learners so now we are on our fourth set of pillows, but we have purposed to get a good set next time.

Wedding photos

A few weeks back, my wife posted a dozen frugal wedding ideas and in one of them, she mentioned that there are ways to reduce wedding photo costs, but you should never sacrifice wedding photo quality. They are the one thing from your wedding that you will look at for years to come. If you have to pay a little extra to get good quality in this category - do it.

Honeymoon

This is the one life event where I think couples should splurge. This is a great time in your life to try new things together and live in luxury - don’t finance your honeymoon, don’t spend money just because, but for goodness’ sake, have some fun! There will be many chances in the future for you to practice financial self-discipline. Yes, there are common sense ways to reduce costs on your honeymoon, but spend what you need to spend in order to do once-in-a-lifetime things.

So often we think only in the moment, and we do not make purchases with an eye toward the future. This is not necessarily frugal - sometimes it is just plain cheap. My wife and I are still trying to develop the habit of purchasing quality, not just looking for instant gratification. We often wish that when we had more disposable income earlier in our marriage, we had take more time to purchase quality. Ironically, we usually end ups spending the same money if not more over time - for junk.

Are there any other items where you think it pays to spend a little more?

Photo by: brent

Can you believe Gather Little by Little has been online for 2 years now?  Me neither, but it has.

Since July 2nd of 2007, I’ve published 700 articles (this is article #700), had more than 690,000 unique visitors, 1.1 million page views, and more than 3,000 people have subscribed!!  Wow.  God has really blessed.

Gather Little by Little started on a small personal blogger blog where I was writing about personal finance, then towards the end of July I decided to start a personal finance blog.  The sole purpose was to share what I was learning about personal finance in order to help others.  Since then I’ve received several hundred emails from readers thanking me for writing on Gather Little by Little and sharing how much GLBL has changed their lives.  I even have one couple who reads my daily articles together.

Gather Little by Little has grown far bigger than I ever thought it would and it has taken me places I never imagined.  2 years ago I barely knew what a blog was, now I not only have a top Christian personal finance blog, but a number of other smaller blogs as well.   Coupling my blogging experience with my technical background also allowed me to start my Empty Cabin Media consulting and development business which has become another huge success.  Who would have thought huh?

My success though is due to God and you.  I truly believe that God gave me a mission through GLBL and without you, the readers of Gather Little by Little, this blog would be just another of the millions of websites on the internet.  You are what makes Gather Little by Little a special place.  I cannot say thank you enough.

To help say thank you, I’ve lined up a number of giveaways to celebrate GLBL’s 2 year anniversary.  As always, I’m making the contest very easy to enter.  You can two entries this time though:

• Adding a comment below will earn you one entry.  I’d love to hear how long you’ve been reading and what about GLBL makes you keep coming back.
• Subscribe to my daily feed. If you subscribe and send me the secret phrase displayed at the bottom of each of my published daily articles you’ll get another entry.  If you aren’t sure what “subscribing means”, it just means you’ll automatically receive a my latest posts via email or RSS feed.  You can subscribe via email or RSS.  Don’t worry, I’ll never SPAM you and if you aren’t sure about RSS, you can read about RSS here.

Here are the prizes up for grabs!

• iPod Nano 8Gb - If you win, you pick the color!
• Free copy of You Need a Budget Pro
• 1-year free subscription to NeoBudget
• Upside Living in a Downside Economy by Mike Slaughter
• Money Strategies for Tough Times by Matt Bell
• The Skinny on The Housing Crisis by Jim Randel
• The Skinny on Willpower by Jim Randel
• The FAITH-BASED Investor by Jay Peroni

The contest will run for a little over 2 weeks.  I’ll post the winners on Friday July 17th.  Please make sure you leave a valid email, as that is how I’ll contact you if you win.  If I can’t contact you, you can’t win.  Winners will be chosen randomly and each winner will receive only one prize.

Thank you again for reading Gather Little by Little.  2 Years!  Woot Woot!

Photo by: ritchielee

A long time reader named Bobbi sent me an email recently. The email contained a list of 45 lessons that life taught Regina Brett, a 90 years old resident of Cleveland, Ohio. The list inspired me to share my own list of lessons, but from a personal finance perspective.

Of course I’ve learned far more than 40 lessons, and the list grows daily, but here’s the top 40 I’ve learned so far. Hope you enjoy and if you think it will help others, feel free to share.

1. Mange your money, don’t let it manage you.
2. When in doubt, just take the next small step.
3. Don’t pay minimums.
4. If you can’t control your credit cards, get rid of them.
5. Married?  Manage your finances together.
6. Involve your children in your finances, it may save their financial future.
7. Just when you are starting to make good progress, something bad will happen.
8. Have an emergency fund (see #7)
9. Pay off your credit cards every month, or don’t use them.
10. Don’t have just one income source, have many.
11. Learn from the past, but don’t dwell on it.
12. It’s okay to spend your money, just do so wisely.
13. Save for retirement with your very first paycheck and never stop.
14. Don’t keep up the Jones, it’s a race you’ll never win.
15. If you purchased something and are afraid to tell your spouse, you shouldn’t have bought it.
16. If you suddenly decide you need something you’ve never needed before, wait.  See if you still need it tomorrow.
17. Keep your finances simple.  If you don’t, you won’t take the time to do them.
18. Set short-term financial goals, achieve them and set new ones.  Progress keeps you motivated.
19. Set long-term financial goals and have a plan so you aren’t driving through life not knowing where you’re going.
20. Remember, your current crisis most likely won’t be crisis a few years from now.
21. Money is always available.  Seek it out if you need it, don’t wait for it to find you.
22. The last thing you’ll think on your death bed is that you should have worked more.  Money helps, but there is so much more to life.
23. No matter how bad you think your problems are, someone somewhere is worse off.
24. Create and follow a budget.  Even the biggest and most successful corporations do.
25. Your biggest financial problem is you.  Fix yourself first, then fix the rest.
26. Always search for “deals“.  Somebody, somewhere always has what you want for less.
27. In most cases, buy used.  Buying new makes great sense for the seller, and poor sense for you.
28. Finance is personal.  Who you are and what you believe have everything to do with how you manage your money.
29. Give and you shall receive.
30. Your children are the best investment you can ever make.
31. Whatever you are planning to do, do today.  You just might not be here tomorrow.
32. Take calculated risks, otherwise you won’t grow.
33. Financial planning isn’t just about your present life, but about the lives of your loved ones after you leave.
34. There is no such thing as “good debt”.   Some debt is just a little better than others.
35. Sacrifice in the short term to gain in the long.
36. If it seems too good to be true, it most likely is.
37. Measure twice, cut once.  Always consider your actions at least twice before acting.
38. Treat every bad situation as a test from God and pass the test.
39. Read the Bible, you’ll be amazed what you can learn.  Yes, even about personal finance.
40. It’s okay to make mistakes.  Mistakes are how we learn.

How about you?  What are some lessons you’ve learned?

Photo by: star5112

Last week, I wrote about my belief that when it comes to giving and tithing, the Bible does not prescribe an exact percentage of giving for the New Testament believer. The idea that the ten percent tithe is a hard and fast command to the church goes against the spirit of the New Testament, and it is nowhere expressly stated by any New Testament writer.

My goal here is not to argue for or against the tithe. That has been done many times before and while I would enjoy the discussion for and against that invariably ensues, I would rather explore the idea of “100% living” that I believe is found throughout the New Testament - specifically when it comes to our finances. I use the term “100% living” to refer to the  expectation that we will freely serve our God will all the things with which we have been blessed. My goal is to order my life so that I serve God with a greater and greater percentage of my life. Here are some questions that I use to help me evaluate how I am doing on my goal of 100% living:

Do I serve money?

Money is a tool, not a goal. Matthew 6:24,25 famously states:

No one can serve two masters. Either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve both God and Money. “Therefore I tell you, do not worry about your life, what you will eat or drink; or about your body, what you will wear. Is not life more important than food, and the body more important than clothes?

Are your life decisions inordinately impacted by the financial implications of those decisions? Does your family suffer as you seek to earn more and more money? Do you neglect your church and those around you in order to earn more or hang on to more dough? Could you improve your family life and spiritual life if you lived more frugally and stayed home rather than working more hours to pursue a lifestyle of entertainment? Is your trust in your 401K greater than your trust in God?

Do I provide for my family?

Paul wrote out these instructions in I Timothy 5:

Give proper recognition to those widows who are really in need. But if a widow has children or grandchildren, these should learn first of all to put their religion into practice by caring for their own family and so repaying their parents and grandparents, for this is pleasing to God . . . If anyone does not provide for his relatives, and especially for his immediate family, he has denied the faith and is worse than an unbeliever.

If you are the head of the house, God considers you worse than an an unbeliever if you do not care for your own family! All the gifts to support missions or to help the poor are meaningless if you neglect your own family. This includes your immediate family and your extended family - and it includes the time following your death. Last week, Glblguy wrote about the wisdom in making preparations for your family should the unthinkable happen. Caring for family is a spiritual exercise!

Do I meet my financial commitments?

When a believer makes a financial commitment, his honoring of that commitment reflects on his God. James 5:12 commands the believer to take every commitment seriously:

Above all, my brothers, do not swear—not by heaven or by earth or by anything else. Let your “Yes” be yes, and your “No,” no, or you will be condemned.

and Romans 13:8 says:

Let no debt remain outstanding, except the continuing debt to love one another, for he who loves his fellowman has fulfilled the law.

This is yet another reason to avoid debt, especially debt that is incurred because of the pursuit of pleasure or luxuries that we do not need. The believer who does not do everything within his power to repay the debt that he owes is not only committing a civil offense against another person, but also a spiritual offense against God. To say nothing of limiting his ability to care for the needs of others.

Do I seek to meet the needs of fellow human beings?

There are a host of verses in Scripture that challenge the church and the believer to be active in charitable work. I John 3:16,17 shows how Christ was willing to give all for mankind, and how our response to His act should be to meet the needs of others:

This is how we know what love is: Jesus Christ laid down his life for us. And we ought to lay down our lives for our brothers. If anyone has material possessions and sees his brother in need but has no pity on him, how can the love of God be in him?

Conclusion

Two relevant passages that sum up the New Testament approach to the believer’s finances:

But just as you excel in everything–in faith, in speech, in knowledge, in complete earnestness and in your love for us –see that you also excel in this grace of giving. I am not commanding you, but I want to test the sincerity of your love by comparing it with the earnestness of others. For you know the grace of our Lord Jesus Christ, that though he was rich, yet for your sakes he became poor, so that you through his poverty might become rich. And here is my advice about what is best for you in this matter: Last year you were the first not only to give but also to have the desire to do so. Now finish the work, so that your eager willingness to do it may be matched by your completion of it, according to your means. For if the willingness is there, the gift is acceptable according to what one has, not according to what he does not have. Our desire is not that others might be relieved while you are hard pressed, but that there might be equality. At the present time your plenty will supply what they need, so that in turn their plenty will supply what you need. Then there will be equality, as it is written: “He who gathered much did not have too much, and he who gathered little did not have too little.” II Corinthians 8:7-15

Each man should give what he has decided in his heart to give, not reluctantly or under compulsion, for God loves a cheerful giver. 2 Cor 9:7

Every part of our life - including our financial life - demonstrates our view of God and our relationship to Him. Our financial life is worship just as much as what we might do on Sunday mornings. The believer who does not pay his bills or care for his family is just as disobedient as the believer who does not give to his church. If you give exactly 10% of all of your increase to God, you are doing a good thing, but if the other 90% does not indicate a heart that is wholly committed to Christ, then you are not fulfilling the principle of “100% living”.

What do your financial habits indicate about your view of God? What is your percentage? I certainly have a ways to go . .

Photo by redvers

Hi there and welcome to the Best of Money Carnival #5!  What? You’ve never heard of the Best of Money Carnival?  Well, I’m sure you’re not the only one.  The Best of Money Carnival is a fairly new blog carnival  that features the top 10 articles submitted each week.  Not only does it make for a shorter carnival, but it also gives you the very best of the best out of all the articles submitted that week.  Now of course the downside is on host (that’s me), as picking out the top 10 is tough!

So, without further adieu here are the top 10 best articles submitted from last week:

10 - Which variable impacts your investment return the most?

FMF shares the 3 basic variables that impact the return on your investment, then goes into detail to help you determine which of the 3 is the MOST important.  Not being an investment guru myself, I always enjoy reading a good introductory investment article.

9 - Save money on groceries

This topic has been covered more times than I can count across the personal finance blogosphere, but Lazy Man does an excellent job breaking it down and ends up creating a top notch reference article for saving money on groceries.  With 6 kids in our home, this is something we’re always looking to do!

8 - How debt settlement works

Ever wonder how debt settlement works?  Wonder no more.  Jim provides a thorough and well researched article on the topic that will definitely explain the whole process.  Really good read and I learned tons.

7 - 5 money tips for travelers

Travel is expensive, regardless of how far you go, but when traveling abroad every penny can make a huge difference.  PT shares some tips for saving money based on his recent trip to Ireland.  This article is full of great and unique tips.

6 - How to save on your property tax

Ugh…taxes.  I can’t think of anyone who doesn’t want to find ways to save on our taxes!  Jeff’s article tells us how to go about saving money on our property taxes, which for most of us is our heaviest tax next to our income.  Jeff shows that just a little effort and research can go a long way to saving us money on our property taxes.

5 - Honeymoon planning tips

Getting hitched sometime soon, or know someone that is?  The Financial Highway definitely has an article here you should read or pass along.

4 - Start a side business in the lazy days of summer

A side business, one of my passions.  I love the idea created side and passive income with a side business.  Money Smart Life encourages us to utilize some of our summer downtime to start one.  No time like the present right?

3 - Three magic words to “manipulate” your spouse into total financial submission

While I don’t personally care for the use of “manipulate” or “submission” when discussing your spouse, I do think this is a good article.  Focusing on the positives of anyone’s perspective is always a good way to find common ground in a conversation, especially one where the two parties disagree.  Sound advise, but I’d suggest you avoid “manipulating” or causing your spouse to “submit”.  Neither of these are going to pave the way for a sound relationship in the long run.

2 - Sustainable kitchens: Getting the most out of our appliances

A large portion of your monthly electric bill is the result of appliances in your home, and in particular your kitchen.  Frugally Green shares a thorough and helpful article on how to best utilize your kitchen appliances.  Excellent read.

1 - Identify & overcome money anxiety & stress in relationships

My number one pick goes back to relationships.  Matt shares some absolutely excellent article that just might help you deal with anxiety and stress related to money in your relationship.  I’d have to say that Matt and his wife’s experience is exactly what my wife and I where dealing with a few years back as well.   Excellent article and highly recommended!

~~~~~

Thanks to everyone that submitted!  There were lots of great articles.  If you would like to submit an article to the next Best of Money Carnival, check out the details on how to submit a post.  Make sure you read through the rules though or you won’t qualify.  Unfortunately this happened to a number of people that submitted last week.

The next Best of Money Carnival will be hosted by my friend and fellow Christian personal finance blogger: Pete from Bible Money Matters!

Photos by: TheTruthAboutMortgage.com, Doug Orleans, amandabhslater, bdunnette, chidorian, pizzodisevo, Lincolnian, lumachrome, gregoryjameswalsh, AlastairMoore

Kids are famous for complaining to their parents that they are bored or that there’s nothing to do. A lot of adults who have recently switched over to a frugal lifestyle are starting to sound just like those kids. They simply don’t know what to do to entertain themselves if it doesn’t involve spending any money. Well, just like your parents told you when you were a bored kid, there’s plenty to do if you get creative.

Here are some of the best free events for kids that you can enjoy in almost any place that you might live:

• Outdoor adventures. Hiking, camping, picnicking and reading in the grass are all activities that don’t cost you anything. They can be done just about anywhere especially during the summer. If you live near a lake, river or national park then you have even more options.

• Other outdoor events. Nearly every small town offers planned outdoor events for the community. Outdoor movie screenings, plays in the park, Farmers’ Markets, craft fairs, youth sports events and concerts are all examples of things that you might find offered for free in your area.

• Arts and cultural events. There are a lot of free events that are great if you’re interested in arts, literature or learning in general. Lectures at the local library, open mic nights in your town’s coffee shop and opening receptions at art galleries are all examples of free events you might have fun at. If your town is too small to offer these things, check in the town closest to you and plan an inexpensive day trip.

• Window shopping and people watching. Sometimes it’s fun just to get out and be around other people. Browse through antique stores or malls without buying anything. Sit in a public space and make up stories in your mind about the people that you see there. Daydreaming doesn’t cost a dime.

• Get-togethers with loved ones. Host a potluck dinner. Have a home movie viewing at your house. Put together an impromptu game of touch football in your backyard. You can have a great time with the people you love and you don’t have to spend any money.

Stop complaining that you’re bored because you don’t have money to spend! You don’t have to spend money to have a good time. Look for free events in your area. Just get off the couch and get creative. You’ll be surprised by how much fun you might have.

Guest article by Kathryn Vercillo. Kathryn is a writer for Promotionalcodes.org.uk which gives away free voucher code deals (like this Debenhams promotional code) and also publishes money saving tips.

Photo by: pawpaw67

A frequent subject on personal finance blogs is the discussion relating to tithing. If you conduct an internet search on that topic, you will find a colorful variety of opinions scattered throughout cyberspace.

What is a tithe?

Some of the controversy centers around the word “tithe” itself. The Old Testament Jews had a strict definition of what tithing meant. The first tenth of all their “increase” belonged to God. In fact, one passage made it clear that neglecting to pay the tithe was considered robbery by God. Tithing was not an option and the most faithful Jews tithed everying - livestock, money, garden goods, spice, and more.

This was the time period where God’s people were expected to live in subjection to the Law. Ironically, the Law ended up demonstrated to man his complete inability to earn favor with God. No man could keep any part of the Law to perfection and if you do some reading in any of the books of the Law - Exodus, Leviticus, Deuteronomy - you will quickly see why it was impossible for any person to follow the Law in every point.

Liberty and Grace

Christ’s atonement for the sins of man on the cross began a whole new system. A system where man no longer relied on his own works, but salvation could only be obtained through a belief in Christ. As we read the New Testament, it becomes clear that Christians have not been given a set of rules to follow like the Old Testament Hebrews, but rather we have been given a “law” of liberty and grace.

But it is an unnatural state for mankind. We desire to assuage our conscience and find ways to please God through our own efforts, but He continuously reminds us that the penalty has already been paid, our efforts are just flailing at the wind - worthless. Our only hope is in Him.

A “tithe” might be just a start

The reality is that all we have and all we are belongs to God, He created us, He redeemed those that belong to Him and anything good in our life is a result of his grace.

When it comes to money, God has given us the liberty to choose how best to serve Him with our finances. We are under grace. There is no defined percentage or minimum amount  that meets the requirement. The reality is that we can never repay God for his gift to us. All we can do is seek to conform ourselves to the image of Christ and serve  him with all of our substance.

How?

So then, practically speaking, how do we serve God with all that we have? Do you simply endorse your paycheck and drop it in the offering on Sunday morning? The answer will take some time and will vary somewhat from person to person, but I believe there are some biblical principles that can be a guide for how best to keep God at the center of our finances. I will be sharing my thoughts in answer to that question in my post next Tuesday.

If you don’t believe in God, I hope you will stick around anyway.

Last Friday, I was informed that the wife of a friend I work with passed away in her sleep unexpectedly.  She came home from work not feeling well, went to bed and never woke up.  It reminded me of just how quickly your life can be taken from you.  The article below is an article I wrote in 2007 about a good friend and co-worker who passed away that same year.  I thought it would be beneficial to share Rich’s story with you again.

Rich* walked into my cubicle at work one morning this past February. “Do you have a minute?” Rich and I had been working on a project together and I figured he needed to discuss something concerning the project with me. I couldn’t have been further from the truth. We sat down in a meeting room, and Rich began “It would seem we have more in common than I thought, we both have lots of children, we both have a son with diabetes, we both enjoy football, and now we both have a brain tumor.” Before you get alarmed, mine is a rare but non-cancerous tumor. It can be dangerous, even life threatening, but mine is controlled with medication and is under control. I wish I could say the same for Rich…

Rich proceeded to tell me that he had been diagnosed with a malignant brain tumor at the base of his cerebral cortex (the area of the brain that connects your spinal cord to the brain). He was already experiencing symptoms: loss of vision, dizziness, and he said in order to reach for something, he had to intentionally reach about 4 inches to the left of the the object to grab it. I of course was shocked and completely at a loss for words. See, Rich had recently married. Him and his new wife had a child no more than a year ago. Yes, their little boy came a little late in their lives, but was a welcome blessing regardless. The previous day, Rich and his wife had met with their financial adviser, and where informed they had met and exceeded their retirement goals and that Rich could retire whenever he wanted. He is in his mid-fifties.

Within days, Rich was unable to work, and quickly began both chemotherapy and radiation to treat the tumor. All was expected to go well, and his family and doctors had high hopes that he would return to work soon. They had caught the tumor early, and the doctors were hopeful it could be treated and removed.

Fast forward to yesterday. We visited Rich in the hospital. He was admitted last week due to a stroke along his right side. Due to the tumor, he has completely lost function of his left side. He could barely talk due to the loss of muscle control with the tumor, and to be honest didn’t look well at all. To me, he looked like a completely different man. It was so hard to see this vibrant, funny, very strong man laying in a bed almost unable to move. After seeing him, I don’t think I will ever look at life the same way.

We of course are hopeful that he will overcome this. He is strong, stronger than I think I would be, but the cancer and associated treatments are really taking their toll on him. I am not sure he will ever be the same, even if the tumor is gone.

Where am I going with all of this you ask? My point is, there are just too many situations like this that I have run into during my 37 years in this world. Terrible, unexpected things happen to people all the time. Not just “bad” people, but good people as well. Life throws the best and worst of us unexpected curve balls that can completely change our lives, our priorities, our views, and test our faith beyond all we thought possible.

Even myself and my family have had to deal with a major life crisis that has, to be very frank, “rocked our world”. I once heard a pastor say “For a Christian, life on earth is our Hell.” Having recently gone through our situation, and seeing the two situations above first hand, this message from a long time ago has taken on a new meaning.

Be Prepared

Regardless of who you are, how well off you think you may be, bad things can happen. They may happen while you are reading this article, on your way to work or church, or maybe even while you are throwing the football in the back yard with your children.

These are things none of us want to think about, but are things that happen to people just like you and I every single day. I doubt the people killed in the recent Mississippi river bridge collapse thought they wouldn’t make it to their destination. I doubt the people in the twin towers on September 11th thought they wouldn’t make it home that night, or make it the gym that afternoon.

These are all things we like to put in the back of our mind, even though we see the tragedy occur to others everyday. We like to think those things can never happen to us. Well, the reality is the people we are watching or hearing about thought this very same thing the minute before tragedy struck.

My Best Friends Father

When I was in high-school, my best friend’s father was hit with a sudden and major heart attack while, ironically enough, conducting a funeral. He died before he hit the ground. He was healthy, well respected in the community and loved by both his family and myself. It was horrible, and completely unexpected.

What can you do?

Now that I have your attention, and hopefully have you in the mindset of realizing that you are no different than the thousands, maybe millions of other people in the world impacted by unexpected, uncontrollable life changing events, here’s a few things you can do to to prepare for when tragedy strikes:

Get Life Insurance

If you have a spouse or children that are dependent on your income, you need life insurance. It’s no more or no less complicated than that. What of your chances of dieing? Slim, but do you really want to risk your families future on statistics? I don’t.

Get term life insurance. Depending on your situation, I would recommend 8 - 10 times your annual salary. Term life insurance is cheap, and should be considered a necessary expense just like the power and water bill. I have mine with State Farm and they have a neat calculator that will help you determine how much you really need.

Do not and I repeat Do not let your insurance agent sell you whole life insurance. Do not confuse life insurance and investing, they are not the same. If you want to invest, open a mutual fund. Let you insurance company handle the insurance and your brokerage company handle investing. Insurance agents make big commissions on whole life insurance, and trust me they will really turn on the sales pitch, show you numbers, use your emotions, etc, etc. Just say no.

If you have a family and you don’t currently have life insurance, stop reading right now. Open up another window, do some quick research and get life insurance. Maybe even call your companies HR department, as companies often offer life insurance policies at group rates that are very cheap. That is what I have. I am insured at 12x my salary. 8x through my employer, and 4x through my State Farm agent.

Don’t wait, you might need it sooner than you think.

Health Insurance

It amazes me the number of people that don’t have health insurance. I know, here in America our heath insurance and associated costs are just plain crazy, but you need it. Just like you need water and food, you need health insurance. Sure, for those twice yearly doctor visits it may or may not be worth it, but if some really bad happens, like a brain tumor it will make all the difference in the world.

As I said with life insurance, if you don’t have health insurance, stop reading now and go get it. If your company offers it, get it through them, it is much cheaper. If they don’t, go get independent insurance. A number of health care providers offer independent insurance. If you are self employed, a number of associations or trade groups offer group plans you can take advantage of for a small yearly fee. This is a good option.

What if you can’t afford it? Can you afford not to? Seriously, if you don’t have health insurance, take a hard look at your expenses. Make a budget, reduce your expenses, and include health insurance as part of your overall budget.

Long Term and Short Term Disability Insurance

Depending on your financial situation, you may not require short term disability. What I mean is if you have a significant emergency fund, you might not require the guaranteed income from short term disability.

Long term disability in my opinion is required. Regardless of your profession you need long term disability insurance. Some professional office workers don’t think they need it, I mean after all, who much damage can a paper cut or carpel tunnel syndrome due right?

What if you have get cancer, have a stroke, take a baseball to the head while playing ball with your kids and get permanently brain damaged (yes this happened to a church member of ours)?

Talking with Rich’s wife yesterday, she said the long term disability insurance was a God send. It has made all the difference in the world in her ability to pay the medical bills and cover what the insurance hasn’t covered.

A number of large employers offer long term disability at a fairly low cost. I would strongly advise you to consider it. Unfortunately with my tumor, I applied and was denied so I am looking at other options and will keep you posted on these as I learn more. If your employer doesn’t offer it, do a little Google searching, and you will find a number of companies offer really good plans.

Wrapping Up

I know this post isn’t in line with my typical up-beat and positive articles, but visiting with Rich in the hospital this week, I was snapped into reality about what can happen to you in the blink of an eye. While we can’t control the things that will happen to us, nor can we always control the outcome, we can take steps to mitigate the risk and impact of these events. We can take steps to make things easier on our friends and loved ones when life throws us curve balls, or when the Lord calls us up.

Remember, we don’t know when today may be our last day. We don’t know what tomorrow will hold. Be prepared and be responsible to yourself and your loved ones.

Proverbs 22:3 - “A prudent person foresees the danger ahead and takes precautions; the simpleton goes blindly on and suffers the consequences“

Update: 10/9/2007 - This post is dedicated to “Rich”. “Rich” passed away on September 26th.  He was surrounded by his family when he took his last breath. He is dearly missed here at work, and my only wish is I had gotten to know him better.

* Names have been changed to protect their true identities

Photo by: HyperBob

I am on the road once again and my internet is a little shaky, so I am not going to run the post that I had originally planned for today. Furthermore, Sheila asked for a housing update on this post and since there have been some developments, I thought I would write about our house once again.

As most of you know, we have been trying to sell our house in another state for 15 months without success. A month ago, I was trying to decide what to do. My attempts to ask our second mortgage holder to release the lien on the home in order to allow it to sell in exchange for my promise to still repay the money were unsuccessful. It seemed like we were going to have to stop making payments and suffer the consequences.

Offer still pending

At the last minute, we recieved an offer - not for the amount of money that we owe on the property, but an offer none-the-less. We requested a short sale from our second mortgage holder, asking them to settle the debt for approximately one third of what we owe them, but it seemed like they were not interested in anything less than the full amount. I then learned that the mortgage holder had insurance on the note that would only pay out if there was a short sale, a default or a foreclosure. Those were all options that I have been trying to avoid. We have good credit and I want to keep it that way.

Short sale or no short sale?

In order to avoid a true short sale, we would have had to come up with approximately $12,000 out-of-pocket on the date of the closing. I was making preparations to do this via a 0% APR balance transfer. A risky strategy, certainly, but I could not afford to risk losing a potential buyer while the mortgage company dragged its feet making a decision.

Falling into place

And then, out of the blue, the company holding the second mortgage called me and agreed to accept the short sale amount on the date of the closing AND allow me to repay the balance of the loan over time.

This will allow us to protect our credit from the effect of  short sale or default and allow us to sell our home - exactly what I had asked for originally!

Still hanging on

I have scraped together enough money to keep all of our payments, insurance, taxes, etc. current through July in order to not jeopardize the proceedings. I have had to incur some debt as a result, but it will be worth it if the house is finally sold. You might recall that we had planned to stop making payments in June. If this offer to purchase falls through, we will be in worse shape than before.

So, we are on pins and needles while the buyer lines up financing, conducts the final house inspection and bank appraisals. We are praying and hoping that things proceed according to the plan that has been laid out and we hope to conclude this matter three weeks from now.

We covet your prayers.

Photo by L.Marcio_Ramalho

We purchased a new gas grill over the weekend.  I’ve been shopping and reading about them for a few months as we slowly saved our money for one.  After all of my research, I decided to buy a Weber E-310, which consistently received excellent reviews from every source I found.  The Weber is very expensive though and right at $700.00.  The question of “is quality really worth paying more for” kept looming in the back of my mind.

Since moving into our new home in October of 2008, we’ve been grilling on a cheap Weber “go-anywhere” portable grill.  While it does an decent job, we needed something larger and nicer as we grill out very frequently.  In the past we had owned other grills, but never a Weber.  Within 1 year, we always had to replace the burners and other miscellaneous parts of those grills.  I wanted something nicer, something that that would last.

This week, due to some flexible spending account reimbursements, we finally had enough money in the “grill savings account” to go buy a new grill.  We headed to Wal-Mart to get the Weber, as Wal-Mart had the lowest price by $50.00  Fortunately, they were out (yes, I said fortunately…keep reading).  They had other grills there that I looked at, but nothing that even came close to the Weber.  Next we went to Lowe’s.  The Weber at Lowe’s was a little more, but I intended to have them match the Wal-Mart price.

Before picking up the grill and heading to the check-out line, I decided to shop around one more time.  In addition to Weber, Lowe’s carries Char-broil as well as other various brands.  Char-broil makes a good grill, and we’ve owned them in the past.  Our only issue with them was surface rusting and the short lifespan of their burners.  But I looked anyway, always wanting to be a smart shopper.

Lowe’s had a Char-broil “commercial series”  model 403 grill that they sell exclusively at Lowe’s.  The 403 is a stainless steel, 4 burner grill with plenty of room for even the largest of outdoor family events.  The 403 looks very similar to this one.  The cost?  299.00.  That’s $400 less expensive than the Weber.  The question reared it’s head again: Is quality really worth paying more for?  More specifically is the Weber really $400 better than the Char-broil?

Long story short, I bought the Char-broil.  Why?  Well, to be perfectly honest the main reason was that had I bought the Weber for $400.00 more, I would have been kicking myself.  I wanted a great grill, but just wasn’t willing to dish out the extra $400.00, at least not in the current stage of my financial journey.  I can think of a large number of things we could use that $400.00 on.  Is the Weber worth the extra money?  Maybe.  But honestly Lowe’s has tons of replacement parts for the Char-broil grills and they’re cheap.  I could continue to replace the burners and other parts on the Char-broil for a few years before even getting close to the cost of the initial cost of the Weber.

In the end, we purchased the Char-broil for $300, bought a nice grill cover, a new gas tank, a rotisserie attachment and some cleaning brushes.  All for less than $400.00, still $300.00 less than the Weber.  With all of these “extras”, the Weber would have run us close to $800.00.  The additional $300.00 went into my “laptop savings account” for the Apple Macbook Pro I am saving to buy, but that’s the topic for another article.

How about you? Is quality really worth paying more for?  Should I have bought the Weber?  How do you go about making similar decisions?  Add a comment, I’d appreciate it.

Photo by: dougww