The following is a guest post from personal-finance expert Peter Dunn. He realized that he wanted to deal with money when he was in his sixth-grade math class. The teacher gave the class a stock-market project, and Pete was hooked. Pete hosts a popular radio show, “Skills Your Dad Never Taught You,” on WXNT Indianapolis (News Talk 1430) and appears regularly on FOX News and “Studio B with Shepard Smith.” Pete currently lives in Carmel, Indiana with his wife, Sarah, and his daughter, Olivia.  Pete’s second book, 60 Days to Change: A Daily How-To Guide with Actionable Tips for Improving Your Financial Life, is available in paperback for $14.95, at Amazon.com.

Shelter, utilities, food. For hundreds of years, most people have found these to be necessary expenses and key categories of any budget. They know they must find a way to produce enough income to cover, at a bare minimum, these basics. Yet over time, this group of necessary expenses has continued to grow. And, as you might have guessed, it’s because the word “necessary” is subjective and relative.  This new, behemoth group of expenses is the “New Necessities” and now includes things such as mobile phone service, internet service, and cable or satellite tv. But are your New Necessities—and particularly your New Tech Necessities—keeping you in the red?

Controlling this type of expense is crucial to financial progress. As you hammer out a budget, you don’t necessarily need to scrap that category altogether, though. The most important tip? Make sure your usage matches your subscription plans. In my experience, most people overbuy and underuse these types of subscription plans—whether for mobile phones, internet, or cable/satellite. Here’s how to keep your costs in check: set aside an hour or two and call each one of your service providers to match up your usage with an appropriate plan. Doing this can easily save you hundreds of dollars per year.

Redefining your New Necessities requires taking a hard look at what you think you need but without which you can still survive and thrive. The fundamental questions to ask as you’re redefining are, “How much do I spend on this? And where can I cut back?” Do you really need the fastest Internet service available? What about those 400 satellite tv channels? You might not think eliminating or scaling back on services could save you that much—but once you start saving with a goal in mind, you’ve got a very powerful motivating force. With what you save by cutting your New Necessities list down to manageable size, you can contribute to your emergency fund, save for a vacation, or even sock away for college funds or retirement. It’s your decision: a year of the Handyman Channel—or a fund to someday start that handyman business you’ve always known you wanted to? Take a good, hard look at your monthly budget—and see where there’s room to save by dialing down.

What are your New Necessities? Where could you cut back if you had to—and what would you save for?

60 Days to Change: A Daily How-To Guide With Actionable Tips for Improving Your Financial Life

I’m taking a week off the trail and staying at my brother’s house. I’ll try to get a few new posts up this week. If you want to read my trail journal you can click on the following link.

2010 Trail Journal

I am still alive and hiking. Progress has been very slow so far due to my being terribly out of shape and battling varous sicknesses. This has resulted in lots of hotel stays so I’m spending a lot more than I had planned but I can afford it and my cost per mile should be a lot less once I get in shape and stay out on the trail longer.

Also, I don’t have much time to write new posts when I come to town since I have limited time on the internet. If anyone is interested in having a guest post or maybe even posting on a regular basis send me an email and let me know. Keep in mind that it might be a few days before I can respond to your email. Thanks.

I have moved the start date of my hike up to Monday 3/1. I’m flying from STL to ATL Sunday afternoon. That means I have from after work tonight to get everything moved out of my apartment, clean my apartment, take care of bills and mail, review and pack my gear, and probably some other things that I’m not remembering right now. This would be easier if I hadn’t procrastinated on getting much of this done but I knew everything would probably end up being done at the last minute. I never did get around to writing posts ahead of time to publish while I’m hiking so there won’t be too many new posts while I am hiking.

If you want to read about my hike. Go to TrailJournals.com and search for “Andy Hough.” That will bring up the journals for my previous hikes as well. If any of you happen to live near the Appalachian Trail and would like to meet up. Just send me an email and we can figure something out.

My next update should be from the trail.

Swag Bucks has just launched Version 3.0 and to celebrate they are having lots of new Swag Codes. I have been using Swag Bucks for about a year and have redeem my Swag Bucks for dozens of prizes-mostly $5 Amazon gift cards. It is easy to earn gift cards by searching through their portal and referring your friends.

Swag Bucks has sent me a special Swag Code worth 60 Swag Bucks that is good through March 4th at 6am PST. This code is only valid for new registers. The code is ANDYSCODE3. To use it just go to the SwagBucks.com home page and enter it in the box labeled Swag Code on the right hand side.

I am back from my Vegas vacation and I had a great time. The picture is at Red Rock Canyon where I went hiking with some friends. The trip didn’t start off too well as I lost $200 playing poker the first day. The last couple of days I had a good comeback though. On Monday night I placed 4th in a no-limit hold’em tournament at the Sahara which paid $310. After deducting my entrance fee and dealer toke that left me with a profit of $250. I had won a little bit since losing the $200 so this left me at about a $100 up on gambling for the trip.

My best luck was on Tuesday when I was scheduled to leave. My flight was overbooked, I volunteered to be bumped and scored a $200 travel voucher. It would have been even more if I wasn’t already traveling on a reward ticket. This gave me several more hours in Vegas and I used it to play more poker. I ended up winning $90 playing $4-$8 Omaha H/L. My total of gambling winnings for the trip was $193. Combine that with the travel voucher and I made $393 during my vacation. My expenses(hotel,parking,taxi,bus,valet)were only $252 so it was a profitable vacation. It is too bad I can’t go on vacation all the time and make money.

When I bought my 1997 Camry last October I decided to keep track of all my vehicle expenses so I would know my total cost of ownership.  I know that paying cash for a used car is the frugal option and  I thought it would be interesting to compare my total cost of ownership to that of a new Prius.  Some people claim that the total cost of owning a Prius is less than that of buying a used car.

I currently have a cost per mile of  $0.84.  That is counting the entire cost of my car as depreciation.  If I use a more realistic figure of $500 for depreciation my cost per mile is $0.28.

I used the Edmunds.com site for determining the total cost of ownership of a Toyota Prius. (I’m not sure if the effect of the recent recalls is reflected in their figures yet.)  By their estimates a Toyota Prius would have a cost per mile of $0.42 after five years.    Their figure included financing in the cost.  If you took out financing the cost would be $0.37 per mile.  Although if you paid cash you should probably consider the interest you would have earned on your savings that went for the car purchase.

I was surprised that the difference in the cost per mile wasn’t greater.  The Prius is one of the better car values for both operating costs and holding on to its value though.   With most vehicles there would be a higher disparity. Even if there is only a difference of $0.10 per mile that adds up to $1500 a year if you drive 15,000 miles in a year.  As well as the Prius did it is still more expensive to own than my Camry unless something happens to make the Camry almost worthless in the  few thousand miles which I think is unlikely.  Anyway, I won’t fault someone for buying a new car because if nobody buys a new car I won’t have a used car to buy.

I just finished filing my federal taxes.  I filed online using Tax Act which is completely free for your federal taxes.  It was pretty easy to use and best of all free. Did I mention I like free? The only thing I will change next year is not selling stocks.  It is a bit of a pain filling out all the stocks I sold for possible short term capital gains tax.  My federal refund is going to be $5.  Not too bad considering I had a lot of self-employment income and didn’t have any federal tax withheld.  The EIC and Making Work Pay credits saved me from having to pay. My refund is scheduled to be deposited next week.  I am going to do my state taxes manually because I don’t want to pay to file them and I am going to have to pay the state so I’m not in a rush to get the state taxes filed.  I did manage to file my taxes and make this blog post despite being drunk.   Probably not too smart but it seems like a good idea right now.

I am starting my thru-hike March 2.  That is why I decided it would be a good idea to finish off the fifth of vodka in  the freezer.  I have a lot of hopes for this hike.  I think I lost a  lot of readers last year when I failed to complete my hike or stay abroad as I had planned.  Hopefully if I complete this hike as planned I will regain some credibility.  I also need to get in shape.  This past year I have gotten into the worst shape of my life and have been sick much more  often than usual.  I have also felt tired and unmotivated most of the time.  I have suffered from clinical depression before but I don’t think that is what is bothering me now.  I think it is just laziness.  Perhaps hiking 15 miles a day with 30 pounds on my back will cure that.   I need to get in much better shape physically.  I also need to get better mentally.  I have a pretty good life right now but I should be doing more.  There is a lot more I could do online and towards volunteer work, etc.  that would improve my quality of life and the lives of others as well.  Here is to hoping the hike will help me develop that self-discipline.

P.S.  I am watching Lost right now and it isn’t making any sense which isn’t too surprising since I have trouble following it when I am sober.  Maybe I should start smoking weed and then it would make sense.

In January I stated that this month I would share with you all the foods I buy and what I pay for them and I would only eat out once a week and not purchase any chips, cookies, candy, crackers, ice cream or soda. We are now halfway through the month so I will update you on how I am doing.

On the positive side I have managed to avoid purchasing any chips, cookies, candy, crackers, or ice cream. I did have lots of chips and cookies when I visited my mom for super bowl weekend though. And I used some of my Register Rewards at Walgreens to get more soda. My rationalization at the time was that I wasn’t spending any money on the soda so it didn’t count as a purchase. That is obviously cheating though.

On the negative side I abandoned the goal of only eating out once a week. I’ve been having restaurant food almost every day. And I have been having soda with those restaurant meals.

Now for a complete rundown on all food purchased so far this month.

• 3/4 gallon skim milk
• 4.89 lbs bananas
• 1 box mac&cheese
• 48 oz vegetable oil
• 1 lb bag mini carrots
• 12 oz salad mix
• 12 oz salsa
• 6 Knorr pasta/rice sides
• 1/2 gallon orange juice
• 750 ml vodka
• 1 frozen pizza
• 2 bags of peanuts and 2 sodas
• 7 Burger King meals
• 1 Hardee’s Meal
• 1 Little Caesars Pepperoni Pizza
• 1 Pizza Street pizza buffet

The total spent on this is $53.65.  Some things that kept the cost down are: I had six free meals when I visited my mom, I had a freee $10 Burger King gift card from MyPoints, I received the pizza buffet for free as part of a mystery shop, and I already had some food at the beginning of the month.

Some things that inflated the cost:  I didn’t manage to finish either the carrots or the salad mix before they went bad, part of my half-gallon of milk went bad, and the Knorr sides are for my hike so I probably shouldn’t have included them in this month’s food budget.

As you can see there is plenty of room for improvement in my diet.   I don’t do very well with eating perishables before they go bad and I am still eating out too much and eating too much junk.  I have about as much food in my pantry now as I did at the beginning of the month.  I’ll be leaving for my hike at the beginning of March so I want to use up as much food as I can .  My plan is to not buy any; more food for the rest of the month except when I’m on vacation in Vegas.  I will have another update after the end of the month and let you know how it went.

photo credit: Smart Destinations

Next weekend I will be taking a short vacation in Las Vegas. Through a friend of a friend I was able to get a round trip flight for $100 which was too good of a bargain for me to pass up. Adding in my hotel room, parking, and ground transportation will be roughly $100 more. The only thing that could make this vacation expensive is gambling. And I will be gambling but I plan to keep it under control. I might even win. It has happened before.

I won’t spend all my time gambling. I’ll spend time hanging out with my best friend who is working a poker tournament there. I lived in Las Vegas for five years and I would like to look up some of my old friends there as well. Being frugal I have some coupons for various activities to use also.

Since I am leaving on my hike in March my original plan for February was to keep my expenses as low as possible. My frugality isn’t so strict that it would keep me from taking advantage of bargain vacation like this just because it wasn’t in my budget though.