Last week, I wrote about how I moved across the country with my son in a bid to get a fresh start on my life after divorce. One of the reasons I moved was to experience a lower cost of living. While I probably could have afforded to remain put, and my career isn’t constrained by geography, a lower cost of living comes with a number of advantages for my son and me.

Indeed, before we moved, I talked with my son about the financial ins and outs of the move, as well as the social ramifications. This was a decision that my son and my ex were both involved with. So, while I’m not constrained by geography, being able to live somewhere with a low cost of living has provided us with the following advantages:

Less Work = More Time with My Son

My son is getting to the age where he is more involved with extracurricular activities, but he’s not old enough to drive. This means I need to be available to cart him around. My ex-husband never attended a single baseball game of our son’s, and there has only been one time when he picked him up from an after-school activity. All other times, I have had to be there or make arrangements with someone else to manage these issues.

Moving to an area with a low cost of living means I don’t have to work as much to support our lifestyle and that means I can spend more time with my son. I can help with homework, get him to activities, and just have time to hang out, play board games and chill. Plus, it also means that I can provide a place for him to bring his friends.

Opportunities for My Son

Our low cost of living comes because we live in a medium-sized town in Idaho. In the Philadelphia area, it took at least half an hour to get anywhere. We had to limit my son’s activities because we always had to consider the time factor. Now, it takes five to 10 minutes to arrive at most places, and we are within walking distance of his school. My son is excited to be able to engage in music, sports and academics. He also loves close to his friends. He can do more here, yet still not be over-scheduled. We’ve been able to strike a nice balance and it will help him develop as a well-rounded person.

More Financial Freedom

Finally, even though we could “afford” to live in Pennsylvania, we would have been cutting things a little closer. While I’ve always been the primary breadwinner, my husband’s financial contribution often paid for extracurricular and “fun” activities. With that source of income gone, my son and I would need to cut back and find new ways to save money. And I wouldn’t have been able to reduce my workload. The stress on us both (since I would still be in charge of shuttling my son around, but without the same resources) wouldn’t have been healthy.

Now, we have more financial freedom. We have the ability to travel, and it means my son will still have interaction with his father. Additionally, we have been able to re-structure our finances in order create a smoother cash flow and provide us with more choices.

Moving to an area with a lower cost of living has its challenges — we aren’t able to access some of the same amenities and entertainment options or live close to transportation — but it’s been worth it so far.

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My husband and I bought a 5-year-old vehicle 7 years ago, a particular make and model with high ratings for both reliability and owner satisfaction that holds its value well. The car has been incredibly dependable — even through a cross-country move a few years back.

Recently, however, we’ve noticed an uptick in our vehicle maintenance and repair costs so we have started thinking about selling or trading it in before the transport eats up more money than it’s worth.

With the aim of matching a newer vehicle price as close to the sale price of this one as possible—who wants a car loan? We’ve been car payment-free for over three years and loving it!—I’ve been looking for any bit of advice for squeezing every cent-worth of value out of it. Here’s what I found:

Selling a Used Car Privately

Direct-sale prices are as much as 20% higher than trade-in values based on Kelly Blue Book, but there are trade-offs — chiefly time, effort, and patience. Here’s what the experts recommend doing to get the highest private sale price out of your vehicle.

1. Fix small faults and maintenance items that impact perceived value.

Yellowed head lamps, burned-out blinkers, and broken key fobs might not seem like a big deal when compared to more valuable components, but these things can leave a bad impression with a potential buyer.

Things like worn-out tires and brake pads can also be a deal-breaker. Even if these items aren’t that expensive or serious, a buyer may hesitate when they discover they’ll need to replace these things right away. Some say you’ll likely recoup double the cost of simple fixes because they improve your vehicle’s desirability.

2. Get an inspection and keep records of maintenance and repairs.

Hopefully you’ve already been keeping good records. Providing the paperwork for routine maintenance such as oil changes shows that the vehicle has been conscientiously cared for. And, if you’re not certain of your vehicle’s condition, now is the time to find out — before a potential buyer requests a pre-purchase inspection.

It’s also a good idea to request a CARFAX report that proves it’s never been in a collision. All of this will add more credibility to your listing.

3. Have the vehicle professionally detailed.

Stained, dirty carpet, scratches, and dings immediately stand out when you look closely at a vehicle. A professional detailing — which may include shampooing, engine de-greasing, buffing, and fixing paint imperfections — only costs a couple hundred dollars, yet adds as much as $500 to your vehicle’s resale value.

If you know what you’re doing, save yourself some more by detailing it yourself.

4. Be accurate. Make it interesting. And take good pictures.

Detail is also important in vehicle descriptions and photographs, especially if you’re advertising your car on Craigslist and other online resale markets. Vague, unimpressive descriptions and dark or distant photos aren’t going to help sell your vehicle. You don’t need to be dishonest about its condition, but you do want to play up its best features and make your vehicle stand out.

5. Do pricing research. Don’t take the first offer. Choose the right time to sell.

Sites like Kelly Blue Book, Edmunds, and Autotrader will give you a ballpark figure for the private sale value of your vehicle and a chance to see what similar vehicles are selling for on smaller sites or used dealerships in your area. Use them as a starting point and try to get as much out of your vehicle as you can.

Even if you’re trying to sell fast, don’t take the first offer you get. This is where patience comes in! Be strategic about pricing: if you set the initial price 5 to 10% higher than its value, your buyer will think they’re getting a steal when you accept a lower offer (this is known as anchor price comparison).

And, although you can’t always wait for ideal market conditions to sell a vehicle, consider the season you are in. It makes sense that SUVs and four-wheel drive vehicles sell better in fall and winter, while sports cars and rear-wheel drive vehicles have a better chance of catching someone’s eye in spring and summer.

Trading in a Used Car

Dealerships are notorious for paying as little as possible for a trade-in, then jacking up the retail price once they’ve spiffed it up. But, if you don’t have time to wait through the private-sale process, trading in a vehicle can be the easiest and fastest way to go. Here are a few tricks to ensure you get the most — even from a car salesman.

1. Know the value and negotiate for more, but don’t settle for less.

Walk in with a solid understanding of what your vehicle is worth, and you’ll get a different reaction from the dealership than if you don’t have a clue. Always try to get the most out of your vehicle, but have a rock-bottom price in the back of your head, and don’t let them pressure you in to settling for anything lower than this.

2. Compare offers from at least 3 dealers.

Some say you’re likely to get the best offer from the dealership that services your vehicle, since they have its records and know they can get top dollar when they re-sell it. Regardless of where you go, get at least three offers to compare before making a decision. Some dealerships will have a higher demand for certain vehicle types and will be willing to pay more, while others will view purchasing your vehicle simply as a way of getting you to finance a new one.

3. Move fast.

Most dealership offers are good for a week or less, so if you choose this route, you’ll need to move quickly before the dealership changes its mind.

Getting top dollar for selling your car can be a hassle, but you’ll definitely get more money if you take the time during the whole process. If you think about it, the effort you put in is like having a part time job that pays really well. Do your research, make your preparations, and profit.

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One of the ways to save money is to buy in bulk, as purchasing multiples of an item when it’s on sale is one way to lower your expenses over time. It’s obvious right? If you have a coupon, or if you have the chance to buy more than one of something at a discount now, your per-unit cost will be lower.

Yet, even though buying in bulk can save you money over time, it’s important to realize that sometimes there can be too much of a good thing. Here are some things to keep in mind as you buy in bulk:

Will You Use the Items?

One of the first questions you have to ask yourself is whether or not you will use everything you buy. If you only use an item occasionally, buying lots of it can prove counterproductive. Food, for instance, can go bad before you eat them all. Buying several of the same item, just because you can, is a recipe for backfiring. After all, each item still costs money even if it’s bought on a deep discount.

My family eats pasta at least once a week. We know we’re going to use pasta, so when it’s on sale, we get large amounts of it. Currently, we probably have about five months’ worth of pasta. By the time our supply is depleted, it’s likely to be on sale again. We use the same rationale for ibuprofen and shampoo. If it’s something we know we’ll use, we don’t mind buying more of it.

Will You Consume More Just Because You Have More

Some items we never buy in bulk even if we will consume all of it. Alcohol, for example, fits into this category. If we get a huge bottle, we will probably drink more every time we open ourselves up for drinks. In fact, all non-healthy drinks fall into this category. By not buying a ton of sugary or alcoholic drinks, our body and our wallet benefits. Water is just fine, thank you very much.

Other household items, like toothpaste, fall into this category too. It’s amazing how much more toothpaste we waste whenever we get a big tube (with it’s big opening). Nowadays, we just get a small tube and change it when we need to. It’s more hygiene to keep getting new ones anyway.

Where Will You Keep Your Stockpile?

When you buy in bulk, you should consider how you will store the items you purchase. If you live in a small apartment, it isn’t practical to stockpile large amounts of items bought in bulk. Evaluate your space, and then determine how many items you should buy at once. Don’t buy frozen food in bulk if you don’t have a large enough freezer to accommodate your purchases. Think about building shelves in a room or closet to turn it into an appropriate storage facility. Once you know where you can keep your bulk items, you will be better able to make informed and practical decisions.

Bottom Line

Buying in bulk can be a way to help you protect yourself against price increases in the future. You can get something now, and use it later – instead of paying the price it has likely increased to. It can also be a good way to build up emergency food stores.

You do need to be careful though. Don’t buy something just because you can get a good deal on multiples of it. It’s a waste of money and time if you don’t ever use the item. Additionally, you might not have the room to store lots of bulk items. Before you decide to engage in bulk buying, carefully and honestly evaluate your needs and your ability to store the items. Clear out an area meant for storage, and then decide how much it makes sense for you to buy.

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When my husband and I were first looking for a venue for our wedding, his family was very persistent that we marry in the local country club where his brother and sister were married to their spouses.

When I sat down with the wedding coordinator, my husband, and our families, the number came out to around $10-15K with the choice of a pasta bar for food. His family told me how affordable that was, while I was on the edge of crying because my entire wedding budget was only $8,000.

Wedding venues can eat up a huge part of your overall wedding budget. So if you’re in a similar situation that I was in, here are the tricks I used to save money on a wedding venue.

1. Stay Away from Packaged Deals

The problem with the country club and many other pricey wedding venue locations is that they make you choose their caterers. They will also make you pay for their wedding planner, and their table/chair rentals. You don’t have the choice to pick your own caterers or where you’ll buy the decor rentals.

For the country club, the cheapest catering option was a pasta bar or taco bar for $20 a head. Those two options were expensive for what they were and just did not scream “romantic wedding” to me.

Instead, we found a venue that did not charge extra for a chair and tables. We were also able to choose our own catering. We went with StoneFireGrill.com, which at the time was only $7.99 a person for a meal of chicken, tri-tip, salad, mashed potatoes, and a bread stick.

We were able to save thousands just by staying away from venues that did not allow you to have your own catering. Country clubs and hotels all usually charge you a premium to use their catering services and packaged deals.

2. See What Your City Has to Offer

Many cities have rooms and buildings to rent out for public events, meetings, and weddings. This is the route we choose to go with.

Our local city had a ballroom available for rent for about $1,500 a night, with the use of tables and chairs. The only issues with using city property is that you might have to reserve your spot up to a year in advance, and they may have some strict rules, such as no burning candles allowed.

Also, the room was nice, but definitely more of a blank canvas than a ready-made wedding spot. The money we saved on the venue allowed us to spend a bit more on decorations.

3. Spend Money on Uplighting

One of the best things I spent money on for our wedding was uplighting. Uplighting is the use of mini spotlights that are show up the wall to create a more dramatic look in an specific area. You can choose from a variety of hues and even patterned lights to create that dreamy wedding look seen in magazines.

It cost about $20 per uplight, so for an average sized room it might cost around $200-300 for all of the light rentals. However, the difference it makes in the room is amazing! We choose a warm gold hue uplighting instead of using the awful florescent lights that came with the building.

With the use of uplighting, the chairs suddenly did not look as bad, and if the chair was a little stained, no one could tell in the new lighting. This saved me about $500-$1,000 in expenses to cover the chairs.

Choosing a colored uplighting, such as in blue or pink, could save a couple on table cloths too, since a white table cloth would look much better with the blue or pink uplighting. I consider the uplighting the Photoshop of wedding venues, since it hides a lot of flaws and sets a more romantic mood.

When planning your wedding you want to choose the areas to splurge and what to cut back on so you can get the maximum affect you’re looking for, without spending a lot money.

What are some other ways to save money on a wedding venue? 

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When my in-laws moved to a different state, the real challenge came when we cleaned out their garage and started minimizing stuff for the move. “Where do you want me to start,” I asked my mother-in-law while looking at her very packed garage.

She thought for a while and spent a good ten minutes telling what not to touch. I couldn’t touch those vintage items because she was going to get appraised. I couldn’t touch those boxes because my father-in-law needed to do through them. Opening up a cedar chest sent her into a huge sidetrack of memories as she looked at her grandmother’s wedding items. She could surely never part with those.

It’s been a few months since that day, and even though my in-laws made the move, the garage still looks the same. They were able to keep their items stored in the garage while renting out the rooms in the home.

Does this scene sound familiar to you? If you’ve ever tried to help someone with a lot of stuff (aka a hoarder), then you know how hard it is to actually get anything done. Everything they own has potential value or sentiment, yet no progress is ever truly made on what items get sold or donated.

If you’re guilty of this, or know someone who is, here are some easy steps to take to overcome your hoarding habits.

The Frugal Side of Being Clutter-Free

I consider myself the opposite of a hoarder. I enjoy having an easy-to-clean home where each space is maximized for living, not storage. I know many people struggle with the battle of clutter, and I’m here to give you some encouragement today. The more clutter and “stuff” you get rid of, the more freedom and money you will have.

Here are a few examples on how shedding your hoarding ways can save you money:

• You don’t have to pay for extra storage space
• A clutter-free garage means you can actually park your cars and extend their value (I live in a desert, and the heat and sand damage is tough on my car)
• It’s easier to find stuff, which saves time and money, because you won’t have to replace items you already have due to misplacing them
• Your house will sell faster when you show your home without clutter
• Too much clutter can lead to a lot of dust, which can mean having to pay for more allergy medicine
• A decreased chance of falling or injury

4 Steps to Ditch Your Hoarding (and Costly) Habits

So how do you keep your hoarding habits at bay, especially with the holidays fast approaching?

1. Keep Life Simple.

Stuff can accumulate over the years, and before you know it, you have multiple dish sets, a closet full of towels, and at least a hundred pieces of clothing and accessories. When I first started cutting down my wardrobe, it was hard to get rid of things. But the truth is that I only wore about 25% of my wardrobe, and my closet was always a mess because there were too many things to keep organized.

Getting rid of items is hard, but when I cut my wardrobe down 60%, life was so much simpler. Now, I spend less time doing laundry, deciding what to wear, and keeping my closet and room clean. Once I purged my husband’s closet too, we decided to have a yard sale. We brought in a couple hundred dollars, but the best part is that cleaning is a lot easier now.

2. Don’t Give Into Guilt.

Many people hang on to items because they don’t want offend the person who gifted it to them. Or perhaps it’s hard to sell something at a yard sale when you paid good money for it a few years before.

If you let this guilt hold you back from getting rid of an item, it will hold you back from getting rid of a closet full of unused and unwanted items. I’m not talking about hurting people’s feelings intentionally, but if something’s not getting used, then it doesn’t belong there.

3. Redirect Bad Gift Givers.

This is a hard subject to talk about because you don’t want to offend family members and friends, but you also don’t want to be stuck with a lot of unnecessary stuff. Personally, I think it’s a bigger insult to stick a gift in a garage unused than to return it for something you will use it.

When family members and friends ask what to get my family for Christmas, I stick with the essentials I know will get used. I also direct individuals to give the gift of their time versus a material gift. For example, I suggest they spend quality time with my daughter and get ice cream together instead of buying her a toy.

4. Don’t Procrastinate on Junk.

I’m good about getting unwanted stuff out of the house and into the garage with the purpose of selling it. However, if I don’t put a deadline on following through with that intention, and then it just clutters up the garage for way too long.

Set a note in your calendar to list an item for sale or have a garage sale by a certain date. Otherwise arrange for a donation truck to pick up your items. I would much rather make a little bit of money off of my unwanted stuff, but if the items are taking up space in the garage, they’re better off being donated and not taking up room in my to-do list and thoughts.

Don’t wait for spring to declutter your life and get rid of your hoarding ways. Clearing out your closets and shelves is the perfect thing to do before the holidays. It’s really freeing to decorate a home that’s not overflowing with stuff.

Confession time; do you tend to hoard unnecessary items or do you enjoy a clutter-free living?

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I have no plans of allowing my son to have a cell phone until he’s old enough to drive. I just don’t. Part of my aversion toward children, tweens and young teens carrying cell phones stems from my years of teaching and the fact that I would really like to avoid adding another distraction to my child’s academic life.

I also worry about the financial aspect of cell phone usage. Small children are lacking in both an income and an understanding that easy-to-make phone calls and text messages cost money.

Still, I know that things may change in the next few years, and it’s certainly possible that I will want to give my peanut a cell phone sometime before 2026. So here are some things to consider as you are fielding your child’s daily pleas for a cell phone:

Want vs. Need

I risk dating myself by saying this, but no one needed a cell phone when I was growing up. However, always having some change on me meant that I could make a call from a payphone (remember those?) if ever I needed to reach my parents.

If your child is begging you for a cell phone, think hard about whether or not this is really a necessity. If your child carpools to school and is generally in the presence of an adult all day, a cell phone is not necessary for anything other than texting and having a social life. (And of course, your child probably considers those necessary for survival).

If your child walks to and from school or sometimes needs to wait for a ride home from an after school activity, having a means of calling home will give you both a sense of security. (It is important to note, however, that keeping your child constantly connected through cell phones doesn’t give her an opportunity to learn self-reliance. This is one of the major arguments used by experts who don’t approve of kids using cell phones.)

Know Your Plan

Ask any parent about the first bill they received after putting their child on the mobile plan, and you’ll likely hear a horror story of the several-hundred dollar cell phone bill. If you are going to add your child to your cell phone plan, it pays to do your homework ahead of time.

How much calling and texting (because, believe me, they will be texting) is included in the basic plan, and how much it’ll cost if your child blows pass the pre-set limits? How much would it cost to go to an unlimited plan? When is peak usage?

Having the answers to all of these questions can help you to avoid a nasty surprise at the end of the month.

Know Your Child

You know your kid better than anyone else, so you are in a unique position to decide if he is ready for the responsibility of a cell phone. Does he have any impulse control, or will he compulsively check for messages? Will he respect your limits or find ways around them?

When it comes to cell phones, until your child is 18 and purchasing a plan for himself, you are financially responsible for his cell usage. If you shudder at the thought of handing over your credit card to your child, then it might not make sense to add your son or daughter to your current cell phone plan.

Pre-Paid Alternatives

If you don’t feel that your child is ready for the responsibility of a regular cell phone, consider buying a pre-paid phone for her. These phones stop working once they reach the usage limit, but they can be reloaded with more minutes.

Some can even be programmed to only make calls to Mom and Dad or 911. This is a great solution for parents of smaller children or teenagers who still need to prove their responsibility.

Providing your child with a cell phone is a big step, and it’s probably a good idea to ask him to help contribute to the cost of its use. Learning now how to be responsible with a cell phone will give your child a leg up once he’s out on his own.

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Many of us could use the advice of a financial advisor when it comes to areas like investing, consolidating debt, and planning for retirement. Some of us need more than financial knowledge or advice that only addresses the number side of the equation though. We also need help addressing our emotional relationship with money. This task isn’t as well-suited for a financial planner as it is for a financial therapist.

Financial therapy is a rather new field, as the Financial Therapy Association has only been around since 2010. The concept of therapy isn’t new at all though. Just as someone might need a therapist’s help to deal with thought patterns and emotions surrounding their relationships with family, spouses, or friends, we all have a very real relationship with money that might need similar attention.

If you answer yes to any of the following questions, it might be time to see a financial therapist:

• Do you feel frequently depressed or anxious about your finances or making financial decisions?
• Do you think about what to do about your finances obsessively but fail to follow through with changes?
• Have you tried to make positive changes like saving money, but keep failing or falling back into old habits?
• Do you suspect you could be sabotaging your own goals?

Like any kind of therapy, financial therapy is designed to help you get to the place where you can help yourself. That means a financial therapist isn’t going to give you advice about which stocks to pick or which budget plan will work best for you (although they might refer you to a financial expert who can help with that). Rather, the therapist will ask you questions that causes you to think about the situation differently.

A financial therapist might ask you to talk about your overall money goals, your past financial failings, or how your parents handle money (it’s no secret that we get a lot of our money mindsets from our parents!). They might also ask you to do a word association test that revolves around money. By talking things out, it becomes easier to identify the negative emotional and mental underpinnings of your relationship with money and then move on to tackling them.

Like traditional therapists, financial therapists will recommend a variety of psychological techniques and practical steps to help you change your behaviors. For example, if you’re struggling to save money, they might help you find motivation by focusing on how good you felt the last time you were successful at it. If you discover that spending money on yourself makes you feel guilty or anxious, they might help you set up a system that makes it feel safe to do so and reinforces it as a positive way to care for yourself.

If you think you might benefit from seeing a financial therapist, it will be hard to find a professional with that exact certification, although some universities are starting to offer programs of study in financial therapy. Most who title themselves as a financial therapist will have a combination of financial training and psychology or counseling degrees. The best place to look is through the online Financial Therapy Association’s directory.

Whether we seek out financial therapy or choose to deal with our emotional and mental hang-ups around money in other ways, it’s helpful for all of us to examine the impact of this relationship on our current habits, financial situation, and goals. What do you think will happen if you talk to a therapist about money? Do you think you will benefit from financial therapy?

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Have you ever wondered why so few of us succeed? We always hear about those people that came up with a simple idea and made millions but most of us react with “Oh well, all the simple ideas are gone by now.”

What’s ironic is that usually every few months, we hear about another idea that seems brilliant and ridiculously simple. Why does this happen? Why do we keep limiting ourselves?

Perhaps one of the fundamental problems most of us have is thinking that many things are impossible to accomplish. We like to stay in our little comfort zone, and even though we know it’s not the best for us, we are afraid to step outside.

Compare this with Josh Silver’s quest to help 1 billion poor people see better with $1 glasses. Now this guy has a vision. Can you imagine how many people told him through the years that it’s impossible? No, no and no, they say but yet he plows through and insists to continue.

Today, he’s already distributed 30,000 pairs of self-adjustable glasses without the need of a optometrist. There are still challenges to mass produce these “But I am entirely confident that we can do that” is his answer to all the critics.

It’s all our attitude and mindset.

Are you still not sure how to get started? Here are 3 areas that can help you think about how you can accomplish what you always thought was impossible.

Career and Work

Stop complaining about your boss and how all those deadlines are impossible to meet. Whether it’s true or not, you probably waste more time thinking about what’s wrong with it than actually working on those tasks. Instead, focus on how you can most effectively get everything done and let your boss know about your plan and progress.

Deadlines are set because that’s when it needs to be done, not how long it’s supposed to take. Start giving yourself and your superiors some constructive suggestions on how to speed things up and trust me, your career will advance faster than you can imagine.

Once you are always part of the solution instead of an obstacle, you will get to be the one setting the deadlines. It is never impossible.

Cutting Expenses

We all know the famous excuse – “but I have already cut out all the expenses that I could afford.” Sorry to say but that’s a bunch of BS. There are billions of people living on $1 a day. That’s $365 a year folks. So, if you aren’t saving almost all your salary (whatever it is minus $365 anyway), this excuse just does not get you anywhere.

A wireless phone service that you don’t fully use or the expensive TV bill is a good place to start. It is not impossible to cut your expense.

Family & Relationships

Let me tell you that I was part of the “whiners club” in the past as well. Fortunately, I realized how foolish I was and I’ve since changed my ways. As I slowly stopped complaining and started to focus on the solution, I noticed that my relationships with everybody improved. I attribute that to a few reasons:

1. I was happier. All being negative ever did was made me upset at everything. As I became more encouraging by focusing on “how to get it done”, I became more cheerful. To say that happiness is contagious is such an understatement because people around me were much friendlier when I was always in a good mood.
2. I earned people’s trust. As I became more encouraged about myself, I also became more encouraging for others. While I always try to be realistic, people that seek my advice were more optimistic about their ideas and goals. I became someone who’s advice they value. Best of all, I made so many friends along the way by doing this.

If I always stayed within my comfort zone, I would’ve never enjoyed the improvements that changing my mindset brought to my life.

When you are thinking about your new year’s resolution, why not seriously consider that “nothing is impossible“? If you try hard enough, nothing really is.

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My entire family got involved when I first considered buying a house, since I have the luck of being related to real estate agents, investors, and other experts that are more than happy to give advice about buying a property — even before I ask.

The first thing they asked me was exactly how long I expected to stay in the house. Though I didn’t know the exact amount of time, they wanted to make sure that I’d own the house for at least five years.

Why’s that? What’s the five-year rule for buying a house? 

The Upgrade Cycle

It definitely varies by geographic area — if not by specific neighborhood — but a lot of folks near me will buy a townhouse or condo as their starter home. After about three years, they’ll start looking for a bigger place to upgrade to, either a bigger townhouse or a single family home. This upgrade cycle will repeat itself a few times, as people work their way up to a house that they are happy with and that is big enough for their family.

The thought seems to be that if you’re making a little more money every year, you’ll be in a position to afford a bigger house in three years time. And everyone knows assumes that buying is more cost-effective than renting — as long as you’re paying down the principal on your mortgage, you’re going to come out ahead.

But with an upgrade cycle of about three years, there’s a good chance that you will lose money.

The Five-Year Rule

When you purchase a house, the general rule is that you want to be sure you’ll be in the same location for at least five years. Otherwise, you’re probably going to take a hit financially.

The first hit is your closing costs. Every time you go through closing — buying and selling — money hits the table. Depending on where your house happens to be, the buyers and sellers pay different amounts, but everyone pays something. This can easily add up to thousands of dollars, and limiting how often you have to pay that kind of money is always a good idea.

And you take a second hit when you look at your mortgage statement to see exactly where your monthly payments are going. The way mortgages are structured, you pay much more interest in the first few years you own a house. Usually, it isn’t until you’re about five years into paying down your mortgage that you’ve made enough progress on the principal to make it a better deal than paying rent each month.

David’s Note: When you take out a mortgage, you are paying an interest rate on what you owe. So, in the first year, when the principal is highest, the interest you need to pay is also the highest. However, since the monthly payment is the same throughout the term of the loan (at least with a fixed rate mortgage), more of the payment will be used to cover the interest payments, meaning less is going towards the principal. As your principal goes down, your interest payments will go down, leaving more of your check to go towards the principal.

If you can wait at least five years to move, you’re in a better position to be ahead of the game.

Defeating the Five-Year Rule

Five years is a generality. If you add in a couple of other factors, you can make buying a house that you don’t plan to stay in long-term a better choice.

The biggest factor is how much you’re going to pay on your mortgage. A lot of people buy as much house as they can afford, according to what lenders offer them. That’s usually the upper end of what you can financially manage. If, however, you buy at the lower end of what you can afford and make extra payments, you can pay off a bigger chunk of the principal. You need to run the numbers for the specific house you’ve got your eye on, but you can often come out ahead.

You may also consider buying a house you won’t stay in for five years — but that you also won’t turn around and sell. It’s not out of the question to purchase a house, start paying it down, and fix it up so that you can then rent it out. You do need to be careful to choose a house you can afford in addition to a mortgage for your next home, even if you can’t find a renter. There are plenty of other arrangements that can work out similarly, but you need to study up on real estate before making such a choice.

[Click here for a discussion on whether you should buy an investment property.]

Bottom line: if you know you’re going to buy a house based on what the bank says you can afford, and you don’t want to think about renting it out, don’t purchase a house until you’re ready to spend at least five years in it.

David’s Note: Here’s a quick and dirty formula you can use to help you figure out whether it’s better to buy or rent, which works with any duration of ownership. Try to calculate: Seller and Buyer Agent Fees When You Sell + Purchase Price + Maintenance Cost for the Time of Occupancy + Interest Paid on Mortgage + Investment Gains from Your Down Payment + Taxes Paid (Such as Property Tax) + Closing Costs – Selling Price. This number could come out negative or positive, but if it’s lower than the rent you would have paid during the same time frame, then you would be better off buying. If the number is higher, meaning that the selling price wasn’t high enough to cover all those costs, then renting would be the more cost-effective choice.

And If You Do Need to Sell, Here are 5 Tips to Sell Your Home Faster

One of the realities I had to face when I recently moved across the country was that I needed to sell my home fast. I ended up listing with a relatively new real estate agent who could help me immediately find someone to buy the house. Our family was also willing to take a loss on the home and pay out of pocket to make the deal go through if necessary. In the end, we sold the house in less than a week without it ever being officially listed.

If you want to sell your house fast, there are a few other things you can do to improve the chances of selling your house faster. Here is what Bennie D. Waller, a Professor of Finance & Real Estate at Longwood University, suggests when it comes to selling your home fast:

Start with an Appraisal

Waller suggests that you begin with an appraisal for your property. That way, you have a better idea of what your home is really worth. Too often, we attach a higher value to the home due to sentiment. An appraisal ahead of time can help you see what your home is likely to fetch on the market.

Price Below Market Value

Your next step is to price your home below market value. If you want to sell your home fast, you need to offer an attractive deal. It might not be what you want to do, but if you sell for less than you owe, you can move the home off the market much faster.

You also have a better chance of attracting multiple offers, which will not only increase the selling price with a bidding war but motivate buyers to eagerly do what he or she can to close without giving you too much of a hassle.

De-Clutter Your Property

Make sure that you present your home in its best light. “Put pets in kennels. Rent a storage unit if there is excessive clutter,” says Waller. That way, you will be able to show your home when it’s most attractive. Curb appeal goes a long way toward helping you sell your home a little bit faster. If you fix cosmetic issues to make your home more attractive, you will have better luck selling your home fast.

Attract Brokers by Motivating Him or Her

Waller suggests you attract brokers willing to list your property by offering better commissions. “For example, offer 8% commission,” he says. “Give 3% to the listing broker and 5% to the selling broker. This will generate traffic from your listing agent as well as cooperating agents.” Money talks, and nothing motivates an agent to bring in buyers more than higher commissions.

Hire an Experienced Professional

He also suggests hiring someone experienced as well. However, he says that you should avoid a broker that is marketing his or her own property or has a lot of listings similar to yours. “I have a research paper that shows that agents marketing their own properties displace efforts.” Make sure that your listing is going to have priority if you want your home to sell fast. The last thing you want is for the agent to be suggesting interested buyers to look at his or her other listings.

The truth is that selling your home fast is likely to be an expensive experience. You will probably have to do a little more, and pay extra for the convenience of a fast sale. If you can swing that, or if you know you need to move, then it might be worth the cost.

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One of the scariest financial situations to be in is living paycheck to paycheck. Unfortunately, too many people are in this predicament. According to a study done by LendingClub and PYMNTS.com, 64% of Americans live from paycheck to paycheck. What’s even more surprising is that almost half of Americans who earn more than $100,000 live this way as well. It’s a difficult situation to be in, especially when you have a family to support. It can also be mighty tough to get out of this rut.

Having savings to fall back on in case of emergency is important to everyone, which is why living paycheck to paycheck can be so dangerous. Any unexpected expenses can really complicate your life and create long term problems that make it more and more difficult for you to dig out of this hole. If you’re living paycheck to paycheck, consider these seven tips to help you get on the right course:

1. Change Your Lifestyle

The first thing you need to do is to change your lifestyle, which is more of a mental change than anything. Being financially healthy is more than just skipping a couple trips to the mall or brown-bagging your lunch. It’s a commitment to changing your habits and improving your life. You not only need to understand your long term goals, but you also have to want it as well. It’s going to be a long road ahead and you won’t get very far if you’re not taking it very seriously.

2. Reduce Discretionary Spending

When you’re living paycheck to paycheck, you should drastically cut down on the luxuries. It’s OK to treat yourself every once in a while but not too often. Unfortunately, most of the discretionary spending will have to wait until you can get your finances back on track. That means only spending on things you need until your situation improves. You’ll have to cut back on your lifestyle significantly and your social life will take a hit, but you’re going to have to make sacrifices if you want to get out of this rut.

3. Stick to a Strict Budget

Make sure you have a strict budget and you stick to it. You might not need to track every little penny, but you need to know exactly where your money is going and whether you need to adjust if you’re living paycheck to paycheck. Track your expenses carefully and analyze your habits to see if there are ways you can cut back at the end of every month. The good news is that once you start tracking your expenses, you will likely find money leaks you can safely cut out without even missing what you get from that spending.

4. Look for Ways to Save

There are literally an unlimited amount of ways to save. Sometimes, you may even be able to get a discount without changing your consumption at all. I frequently call my Internet provider to extend my new customer discount before it expires. Perhaps you can give them a call now to start paying less from now on. I also always make it a point to call the medical provider every time I get a medical bill. Not everybody does this, but some will extend a discount to you just because you asked. I’ve received a 10% discount a few times. One time another offered a 20% discount that saved me $150. The worst they can say is no right?

5. Earn More Money

You may have already cut back on expenses but still find yourself with nothing left over after every paycheck. In this case, your best bet is to find ways to earn more money. There are many simple ways to make extra cash, such as babysitting, dog walking, or running errands. If you have a skill that is in demand, you can put it into use whether it’s writing, graphic design, or coding. Many small-business owners started their companies as side jobs just to make extra money and honed their skills over time. Who knows? This may be the first step to building a thriving business down the road.

6. Start Saving

Any extras you have left need to be saved. Start a savings account, and then move on to an investment account once you have an ample emergency fund. It doesn’t matter if the leftovers are tiny. Save that $5 every two weeks. Heck. Save that dollar. Once you are in the habit of accumulating, it’ll be easier to increase that amount. The first step is always the hardest but the most important.

7. Make Savings Automatic

Consider taking savings further by automating it. Treat savings as an expense and just have it automatically transferred to a savings or investment account that you don’t touch. Out of sight, out of mind. This works elsewhere and it works for building wealth too. You won’t miss the money over time and the beauty is that you’ll find yourself with a nice financial cushion after a while.

Have you ever lived paycheck to paycheck? If so, how did you change your financial habits?

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We’ve all heard that “money can’t buy happiness,” and by now many of us are aware of a recent study that showed that, when you earn more than $75,000 a year your levels of happiness don’t increase very much.

While you probably won’t find lasting happiness based entirely on how much money you manage to amass, the way you spend your money can contribute a great deal to the amount of happiness and enjoyment you get out of life.

Here are 4 ways you can use your money to get a little more out of life:

1. Spend it on what YOU like best.

So many of us spend money to get things meant to impress others. The neighbors have a 55″ TV, so you figure you ought to have one as well — even though you don’t watch a lot of TV. A lot of dissatisfaction in life comes from spending on things that you don’t really feel are important. Instead, examine your values and financial priorities, and then spend money on what YOU like. Forget about what others will think of that trashy novel. If it’s your guilty pleasure, and you really enjoy it for a relaxing escape from every day life, it’s not a waste of money.

2. Give it away.

Interestingly, a study in the Journal of Consumer Psychology found that people who spend money on others are happier than those who only spend money on themselves. Giving to charity, helping friends and family, and other spending that helps you feel as though you are making a positive contribution actually triggers activity in areas of your brain associated with receiving rewards. So, you can use your money for good — and enjoy a little more happiness in your life.

3. Focus on experiences.

While this isn’t always true, many people find that they are happier in their spending if they can use their money to enjoy experiences. This really resonates with me, since I am an “experience” person. While buying things can give you a thrill because it’s something new, pretty soon that object becomes a regular part of life, fading into the background. An experience, though, is always extraordinary. You can look back on your three-day getaway to the mountains and feel a little jolt of happiness — even years later. This is because you went outside your day-to-day experience. A trip to a Yankees game rarely becomes commonplace for most of us. Being able to spend your money to create these great memories gives you something to look back on, and creates a little bit of happiness each time.

4. Indulge in small pleasures regularly.

Instead of always scrimping and saving for that one big thing, consider indulging in smaller things regularly. Once you have that big thing, the newness and excitement of it starts to wear off as it slowly becomes part of the everyday landscape. A small indulgence regularly, though, always becomes something interesting to look forward to. As long as it’s affordable, it provides you with something new regularly. A trip to the movies, a new book, or an ice cream cone can be a fun way to add variety and spice to your life — without costing a lot.

How do you use money to add more enjoyment to your life?

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Sometimes, throwing a kid’s birthday party can be a real pain. You have to prepare a bunch of food for your guests, entertain a house full of kids, and pull it all together with a little style.

It can be expensive and stressful — but it doesn’t have to be!

Here are five tips for throwing an awesome kids birthday party on the cheap:

1. Choose a theme

While choosing a theme isn’t a necessity, it can help you pull your party together.

When you choose a theme, you can come up with snack ideas, games, and décor more easily. Choose a simple theme that your kid is sure to love, and use it as your party guide.

For example, my youngest daughter has a birthday just around the corner. When trying to come up with a theme, she jumped from rainbows to flowers to ladybugs. My solution was to just have a “spring adventure” theme, for which I could pull all of her ideas together.

2. Prepare simple food

Food and drink can be the most expensive part of the party. That’s why keeping your menu simple is the best way to keep costs down. Instead of trying to please everyone, just offer bottled water, freshly brewed tea, and juice boxes. As for the food, classics like hamburgers and hot dogs will work just fine.

3. Buy supplies at the dollar store

The Dollar Tree is my party supply store, but you can visit any of your local dollar stores. You’ll find so many party supplies for only one dollar — go elsewhere, and you’ll spend at least triple the price. Some of my favorite party supplies to buy from The Dollar Tree are plates, balloons, snacks, napkins, cups, and decorations.

4. Play free games

You can’t put a price on fun — but you don’t have to pay for it either!

Some of the best party games won’t cost you a penny. Here are some of my favorites:

• Hot Potato
• Red Rover
• Egg Toss
• Duck, Duck, Goose
• Treasure Dig

Since my daughter’s party is a spring adventure theme, our big game will be a treasure hunt. To successfully pull this off for young children, I’ve bought a six-piece puzzle and will hide the puzzle pieces all over the backyard. The kids will receive clues that guide them to the next puzzle piece, and when they put all of the pieces together, they’ll be told where they can find the hidden treasure!

5. Choose your party favors wisely

One of my family members goes all out on goody bags, which makes me feel bad for throwing many of its contents away. Today’s goody bags (which aren’t cheap to make) mostly consist of cheap plastic toys that never get played with, plus tons of candy.

Think outside of the box when it comes to party favors. For instance, if you’re having a cowboy-themed party, give each kid a bandana. If you’re having a beach party, give kids a sand pail. For my spring adventure party, we’re giving away bug-catching kits (bought at The Dollar Tree, of course!).

If you start planning your child’s birthday party a month or so in advance, you can look for good deals, let your creativity flow, and have a great birthday party — without the high cost.

How do you save money on kids’ birthday parties? 

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