When we see a great deal, we are inclined to think that we are “saving money.” Some store receipts even help with this illusion by giving you a total of your “savings” at the bottom, so you can see what a savvy shopper you are.

However, in many cases, you might just be overspending when you think you are getting a good deal. Here are 3 ways you could be spending more than you should — even while thinking that great “deal” is “saving” you money:

1. Buying Bulk Items

At first glance, buying in bulk seems like an obvious way to save money. The per-unit cost is often (but not always, so watch out!) lower than the single item price. However, that doesn’t mean that you are actually saving money. My husband is about done with a Ph.D. in experimental psychology, and he tells me that there is an interesting study showing that if you have more, then you consume more, and that packaging makes a difference. The bigger the container, the more you consume.

Buying in bulk has much of the same implication. If you have a large amount of food that you bought in bulk, you are likely to adjust your consumption habits by eating more. The same is true of buying toilet paper or paper towels in bulk. The large amounts of these items can, in some cases, encourage you to use more, since you feel that it is “safe” to use these items liberally.

While you can sometimes save money by buying in bulk, it is important to make sure that you don’t increase your consumption as well.  One way you can do this is to repackage bulk items when you get home, so that they are in smaller containers, encouraging slower consumption. Another area of concern is purchasing items that won’t go bad before you have a chance to use them.

2. Clearance and Sale Items

Sometimes we see that something is on sale. And we feel we need to get it, right now, or miss out. It might not be something that we need — or even want. However, if you are getting something just because it’s on sale, and you’re afraid it won’t be later, you are setting yourself up to overspend. Even if you buy something on clearance, you are spending money. If it’s money you weren’t planning on spending anyway, you aren’t actually saving anything, no matter how good the deal is.

Instead, evaluate the purchase. Is it something you actually plan on getting in the next few weeks? If so, it might be worth it to get the item while it is on sale. But if it’s something that you vaguely think “might be useful to have around”, you might end up spending when you should be staying your hand. The same goes for clearance. I bought a pair of jeans because they were $5. I didn’t like the fit, but bought them anyway because they were just $5. Those jeans are never worn, and I just wasted five perfectly good dollars that could have been spent on something I’d actually use. This is far from saving money.

3. Using a Credit Card

You’ve probably seen posts and articles based on a 2008 study from the Journal of Experimental Psychology showing that those who use plastic are more likely to spend more money than those that use cash. The thinking is that when you swipe your credit card, you aren’t watching the money disappear. You can’t physically see the money leaving your hand. Instead, you are able to look more at what you are purchasing, since using plastic is more abstract. You focus on what you are getting, and don’t worry so much about the cost. Once you stop thinking about the cost, it is easier to overspend. Couple that with the interests associated with carrying a balance when you realize that you have spent more than you can afford, and the problem magnifies itself.

You can help reduce the chance that you will overspend with plastic by keeping track when you get home. Get a receipt, and enter the amount in your personal finance software or a ledger at home. Holding yourself accountable can help you reduce the chances that you will overspend.

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“It’s amazing that parents get angry with their teens and adult children for not using a credit card wisely, but those same parents have invested nothing into helping their child understand anything about personal finance,” says Eva Baker, the founder of the blog TeensGotCents.

Baker is well-versed in the importance of teaching kids about money since she is a teen herself. Her own mother has encouraged her efforts to learn about money, and blog about what she’s learned in order to help more teenagers learn about the importance of developing good money habits as early as possible.

Do you talk to your kids about money? When was the last time you helped them save towards a goal, or talked about the importance of budgeting? Do you model good financial behavior as a family?

What Lessons Do You Teach Your Teens?

As my son approaches his teenage years, I’m thinking more about what I teach him concerning money. We’ve been careful to help him learn how to plan for purchases, save money, and give money to charity. Now, we’re starting to help him learn how to invest, and talking about what makes a good investment.

However, I realize that I haven’t taught my son much about credit so far. He doesn’t have a good handle on debt and credit, and he doesn’t really get what it’s about. This can be dangerous if he grows up and has to figure credit and debt out for himself.

Once, a couple of years ago, we let him borrow against his allowance for something, and we showed him that he would have to pay interest. He made payments each week for a month to repay us, but that lesson was a long time ago, and I’m not sure how effective it was.

“Being purposeful in teaching their children how to handle money and credit wisely is a necessity,” says Baker, of parents. I admit that, so far, there hasn’t been a lot of purpose in the way I’ve taught my son about money, and spending.

So I hope to approach it more consistently going forward. He’s reaching a time in his life when good habits can be developed — and bad habits can be as well.

Be Careful About Adding Financial Responsibility

As you teach your kids and teens to use money, especially credit, it’s important to be careful about adding financial responsibility.

For example; you don’t want to add your child as an authorized user to your credit card and let him or her have unlimited access to your funds. Instead, make sure they understand what’s happening, and that they take responsibility.

Often, this means laying the groundwork ahead of time. Help them progress in steps so they don’t become overwhelmed. Another concern is that they don’t have a good grasp of how money works, and then end up in trouble.

Talk about credit, and show your child how to use it responsibly, paying off the loans as soon as possible. Use your own student loans or car loans as examples. Real world application will allow them learn a lot better.

It’s up to you, as a parent, to teach good financial principles and then help your child put those into action.

Your kids won’t learn how to manage money on their own; if you don’t make it a point to teach your kids, they will likely make poor money decisions. “If a child is terrible with money,” Baker points out, “it’s possible that the parent is a big part of that problem.”

Do you want kids with better money management skills? Start with these four lessons everyone needs to learn and pass on to their own children.

1. Give Every Dollar a Job

Kids need to learn that every dollar needs a purpose early on. You can teach the kids when they get an allowance and birthday money that a portion needs to go to savings, giving, and spending.

2. Say No to Impulse Buying

Saying “no” to kids when they want something in the store is hard, but it’s disastrous if a child gets used to impulsive buying. Instead, help children come up with a savings goal for a particular item. If they are saving $50 for a special toy, then they need to realize that $2 impulse buys on candy or junky toys will ultimately delay their saving goal and make them less happy.

3. Learn How to Comparison Shop

I am still amazed at the many people who don’t comparison shop. Teaching your child how to take the time to do the research will help their money go further. A new iPad might cost $329, but if they shop on eBay or Amazon, they can get a refurbished model for half the price.

Along with comparing prices, teach kids to look up reviews on items. I’ve saved thousands of dollars in my lifetime just by reading reviews of a product before I bought it. It stinks to pay a lot of money for something that doesn’t work like it is advertised. Taking time to search the product beforehand can prevent wasted dollars.

4. Learn How to Bounce Back from Mistakes

Even though you want to equip your child with financial wisdom, there is a good chance they will still make silly money mistakes. That is okay. It’s especially important for kids to make money mistakes now, when only a few dollars are at stake, rather than later when much more money is at risk.

If your child is insistent on buying that low-quality toy or wasting their savings at the arcade, then let them do it. Hopefully, they will learn that spending money in this manner doesn’t make them as happy as they thought it would.

The best way to teach your kids to be financially-wise is to be an example for them. Don’t be afraid to talk to your children about your finances or about money mistakes you made when you were younger too. Your experience is extremely valuable, and not just to you.

What kind of financial habits are you helping your kids and teens develop? How can you prepare them for good money habits as adults?

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A while back we introduced the MoneyNing Manifesto for financial success in the New Year. Its purpose is to empower and motivate you to financial success next year.

Another powerful technique we’re introducing to change your money mindset is visualization. 

If you look up visualization online, you’ll find page after page of “self-help” gurus shilling the idea that you can achieve your goals through the simple act of picturing their achievement in your head.

According to them, if you see yourself achieving your goals, you eventually will.

While there is scientific evidence to back this theory, it’s buried beneath countless pages written by Internet marketers. These guys have been touting this method of turning impossible dreams into easy reality for years.

The data, however, is there, and the method does work.

But, this is a financial blog, not a self-help blog… so you know where we’re going with this, right?

Visualization Transforms Thought

Visualization trains you to change your thinking and feelings so that, in turn, you can change your behavior. Sounds simple enough, yes?

Well, it is. And, then again, it isn’t.

This is where most people get everything wrong.

Many people incorrectly believe that they can simply sit and picture themselves earning millions of dollars, then wait until their world is raining green. But making visualization work for you is a practice that takes plenty of time to perfect.

You can’t just pull up images in your head and think, “Oh! Yes! I want that!” Though this is tempting to many people in search of shortcuts, it won’t work. You must take time to learn the right techniques, and to slow down and practice every day.

Your brain is a fascinating organ that executes millions of processes each day. If you want to change your way of thinking through visualization, you must first study the method, then slowly start your practice.

So, what is the “right” way to visualize and train your brain to think differently?

The Right Method for Results

First, find a comfortable, quiet spot where you can focus on what you’re doing (no TV, radios, or people speaking).

Settle into your new spot with some simple brain wave music. Yes, this is admittedly a bit “new age-y,” but fine tuning your thoughts will be easier with this music playing. Theta binaural beats are super brain trainers for visualization. Get yours here:

http://youtu.be/66tq9xji0xA

Second, sit comfortably or lie down. Begin exploring your ideal life — in this case, your ideal money situation. Focus on your breathing and thoughts. If you find your mind wandering, bring yourself back to your focus. It will take consistent practice before you can turn this into something that’s as easy as breathing.

Would you like to develop the ability to fly wherever you want, whenever you want? Do you want to sleep at night knowing you have X dollars in the bank? Would you like an extensive portfolio, or a sizable retirement fund waiting for you?

Start thinking about what life is like with the things you want most.

Don’t just hold these images in your mind; interact with them. Feel them.

What does it feel like to have the things you want?
Does your worry about not having a large enough nest egg disappear?
Are you free to shop as you like?
Are you smiling because your savings is in an account earning more than 1% interest?
What do you see around you?
What do you smell?
Where are you?
Are you out shopping in the mall?  Can you smell the coffee at Caribou as you and your best friend discuss your happiness — now that you’re no longer struggling to save?

Play your ideal situation repeatedly in your head. Allow yourself to get lost in the physical feelings of your “dream” so that your brain can begin to carve a new pathway. This pathway will help it wake to behaviors that will eventually bring you what you want.

Your brain will grow increasingly alert to the things you must do to render your dream into a reality.

Do this every day: work out your brain like you work out your body. Once you’ve aced this technique, you will no longer have to depend on brain wave music or your special locale. You’ll be able to dip into effective visualization at any time or place.

After your brain has been trained, you’ll hopefully start thinking differently about money. You’ll start reconsidering your purchases before making them. If saving money is your goal, savings will become one of your top priorities, and you’ll strongly consider consequences before spending your hard earned dollars on frivolities.

Have you ever tried any visualization techniques — for money or something else? 

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Just Google the term “get rich” and you’ll see a ton of results for ways to get ahead as easily as possible. And it’s not just get-rich-quick schemes too. There are now a growing number of legitimate money-making opportunities on and offline.

Still, there’s a gap between the number of people obsessed with getting rich and those who achieve this elusive benchmark. After all, the road to wealth is filled with hurdles — whether circumstantial, mental, or emotional.

Circumstances can be hard to overcome, but I think our biggest problem sits between our ears. You can be in the right place at the right time, with everything going for you, and still not get ahead. If desire and even circumstances aren’t enough, how do you know you’re prepared to get rich?

I think these seven signs can be good indicators:

1. You Can Clearly Define What “Rich” Will Look Like for You.

A common hang-up is the inability to define what rich means for you, personally. Most of us aren’t shooting for Bill Gates-level wealth, yet we haven’t defined what we are aiming for. The more clarity you give to the vague idea of wealth, the more tangible it will become to you, and the more it will drive you to do the work it takes to get there. It will also be much easier to tell when you’ve achieved it.

2. You’re Ready to Get Out of Your Comfort Zone.

The process of getting wealthy is rarely comfortable. Even if you manage to get rich doing something you love, it will require some level of discomfort. This could mean pushing yourself to learn new skills, practicing to perfect your art, dealing with annoying people, or stepping into social circles and settings you’re not used to. If you’re ready for discomfort, you’re not ready to get rich.

3. You’re Ready for Risk­, and Loss.

The greatest achievements are often preceded by the greatest risks, the greatest failures, and the greatest losses. Just read the stories of some of the most successful people on the planet, and you’ll see plenty of proof for this. Gaining financial freedom means taking calculated risks and staying determined despite challenges and initial failure. We’re often most afraid of the unknown and what we can’t control — so take control. Being ready for risk requires spelling out exactly what could go wrong and having a game plan in case it does.

4. You’re Willing to Live Like No One Else.

If you want to get rich, you’re going to have to live as if you’re not. We often envision wealth as the freedom to live lavishly, but the wealthiest people are usually the most frugal with their spending. Saving and wisely investing money rather than spending it is what truly makes — and keeps — people rich.

And it goes beyond spending habits. The wealthiest people read more (and not just novels), watch less than one hour of television each day, and use most of their Internet time for work-related tasks. This isn’t to say that wealthy people don’t enjoy themselves. They just waste less of their time than most of us do.

5. You’re Unafraid of What People Might Think.

Socially, strange things can happen when your income level changes. People might start acting jealous, assume you’ve changed, stereotype you, or find it awkward to relate to you. Wealth will often reveal who your true friends are and can even hurt genuine relationships.

The fear of how wealth will change your social position or others’ perception of you can unconsciously hold you back from pursuing a better financial position. Until you get past this, it will be difficult to whole-heartedly pursue financial freedom.

6. You’re Fed Up With The Status Quo.

Sometimes, we just aren’t ready to do what it takes to get wealthy because we haven’t had it bad enough yet. Despite its problems, the status quo can feel safe and even comforting if it’s all you’ve ever known. When you’re fed up with mediocre finances, it’s a powerful source of motivation to do what it takes to build wealth.

7. You Spend Time Absorbing Positive Thinking.

Negativity and pessimism will throw water on any sparks of motivation to get rich. Do you have friends who complain about their money problems but never do anything about them or always shoot down your ideas? Getting wealthy will require spending a little less time with them and more time with people who will encourage you to pursue your goals.

People that build wealth believe in themselves, believe in the real possibilities of where they can be financially, and surround themselves with people and influences (role models, blogs, books, podcasts) that foster a can-do attitude.

So, how do you measure up? Are you ready to get wealthy, or do you need to start working on one of these areas first?

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Used furniture can be a practical way to add to your home’s decor without breaking the bank. While the phrase may conjure up some idea of a couch found next to a dumpster or an ugly dresser handed down just in time for your first apartment, the fact is that it’s possible to find high quality used furniture that has little more wear and tear on it than the floor model at the brand name furniture store.

But many used furniture sellers know exactly what they have on their hands, leading to prices that are not so far off from what a brand new sofa or dining room table might cost you. That means finding the right deal can take a little work. These 10 tips can make it easier:

1. Plan your purchase.

Shopping for new furniture can include plenty of staring at catalogs, making sure patterns match and all that. Shopping for used furniture is a very different animal. You can, and should, have a general idea of the style and colors you want for your home, but be prepared to be flexible. The more flexible you can afford to be, in terms of how well your furniture needs to match an ideal, the better you can do in finding the right pieces. Make a list ahead of time and determine where you’re willing to be flexible – that list can help you stick to your budget when you see an end table or something else that matches your new purchase better than what’s already in that space.

2. Examine furniture carefully.

One of the biggest problems you can face when purchasing furniture second-hand is determining just why the seller is getting rid of that furniture. If you’re working with a middle-man, such as a consignment shop, it’s still important to take a good look at the piece — check for cracks, signs of repair and anything else that seems out of the ordinary. Purchasing something that has a little more wear and tear on it is not out the question. Instead, a scratch or a patch job can give you an opportunity to negotiate the price downwards.

3. Consider repairs.

Everyone wants furniture they can move in and be done with. But the more work you’re willing to do on “new-to-you” furniture, the more opportunities you have to get a deal. Major repairs may be too much, but small repairs, a fresh coat of paint or some new upholstery can make a deal look much better. You don’t have to do all the work, either: many upholstery shops offer a variety of repair services, as well as a way to turn a comfortable couch with a pattern straight out of the 70s look more modern.

4. Check furniture liquidators.

Furniture liquidators can be a great source of used furniture, especially if you look specifically for hotel liquidators. Some furniture liquidators handle more odds and ends of new furniture or office liquidations, but hotel liquidators will routinely have beds, couches and other furniture that has relatively little wear and tear (some hotels replace their furniture every few years). Liquidators can also be a less expensive way to find matching furniture sets.

5. Talk to furniture repair pros.

While most furniture repair shops don’t make a point of selling furniture, many will have the occasional item available — something they fixed up on the side or something that the owner never came back for. You may also be able to get an idea of whether it’s practical to purchase furniture that’s in need of a little more TLC and bring it into the local repair shop if you frequent those shops.

6. Be wary of classified ads, but consider them.

More often than not, individuals posting their own furniture for sale on Craigslist put a higher dollar value on what they’re selling than any consignment shop, liquidator or other used furniture seller would, due to a hope of recouping at least some of the money spent on it in the first place. However, as long as the seller is willing to negotiate, you can turn a classified ad into a better deal. The same goes for garage sales.

7. Take cash along.

Many used furniture sellers are willing to negotiate on price, especially if you’re willing to offer cash. Using cash can also help you stick to a budget. The exception tends to be consignment shops, which usually already has a set price that they are working with.

8. Look for cleaned furniture.

When you’re dealing with certain types of used furniture, such as mattresses, it’s worthwhile to pay a little extra in order to get a professionally cleaned piece of furniture. That may seem like a tip to spend more on a used mattress, but the long-term cost of owning the mattress can wind up being much less. On the plus side, sellers who handle used mattresses in enough quantities and also provide cleaning services usually have more flexibility to negotiate lower prices.

9. Arrange for transportation in advance.

Only some second-hand furniture sellers provide home delivery at all, let alone for free. The cheapest alternative may be a friend with a truck, but many truck rental facilities offer special deals on pick-up trucks, especially if you don’t need the truck for a full-fledged move. Many companies have rates starting about $20 for one day.

10. Give the process time.

Because you’re dealing with used furniture, it’s difficult to guess what a liquidator may have in stock at any given time — and it’s downright impossible to figure out what a private individual may decide to sell. It may seem that there are absolutely no couches (or whatever type of furniture you’re looking for) in the county, but the more time you allow for the process, the more likely you are to wind up with the right furniture at the right price. That said, when you see something that fits your requirements, act quickly. Make your offer as soon as possible, so it may be gone before you know it.

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Money is so often a taboo subject that it can feel difficult to impart financial lessons to our kids – particularly when they’re very little. How do you teach young children and toddlers about money, while also protecting them from your money stresses?

Money management is just like reading (or any other complex skill), in that your kids need to learn age-appropriate little lessons as they take the path to proficiency. You don’t expect your kids to suddenly be able to read without first learning and practicing their ABCs, so you shouldn’t expect them to suddenly understand how to handle money because they reach a certain age. Instead, you need to start early.

Here are four money lessons you can teach your kids so they’ll be on the path to financial literacy — before they’ve even entered elementary school.

1. Budgets are Important

Even kids as young as three can learn basic budgeting, which is a skill they’ll always need. Have your child allocate their money (from allowances, birthday money, etc.) into at least three categories: to spend, to save, and to give.

This will get them used to the idea of not spending every penny they get. It’ll also help them understand that saving money allows them to buy bigger items and that giving money to a charity is (and feels) good.

2. Money Doesn’t Grow on Trees

For small children, it often seems as though grown-ups simply have to go to the bank or the ATM to get more money. They only see you making withdrawals, which they don’t connect with your time at work. When you do take them to the bank, explain that the bank is holding the money you’ve worked for and that you don’t have unlimited money available.

You can make this lesson more concrete by allowing your children to work for money. While many parenting and money experts debate whether allowances should be tied to chores, you can always offer to pay your kids for chores above and beyond what they’re already expected to do.

3. It’s Okay to Make Mistakes

As parents, we often want to shield our kids from disappointment, but that can be a big mistake when it comes to protecting them from the consequences of overspending.

If your child is excited to spend all her cash on funnel cakes and lemonade at the fair — and is later disappointed to realize she now doesn’t have enough money left to play a game or ride a ride, that’s actually a very good lesson about budgeting. It might be tempting to give her more money to play Whack-a-Mole, but it’s better in the long run for her to realize that money is finite and the Bank of Mom and Dad is not there to bail her out of money dilemmas.

4. There’s a Difference Between Wants and Needs

This can be a tough concept for many adults to grasp, let alone small children who feel like they absolutely must have the latest Thomas the Tank Engine toy. You can make this a game you play regularly, by asking your child what they need to live vs. what they want to have. Share your own specific wants, too (like that trip to France you’ve always dreamed of), and talk about what you each can do to someday have the things you want.

With my three-year-old son, I’ve made recognizing wants at the store into a game. I’ll let him look at the toy he’s enthralled by for a little while, and then I tell him it’s time to wave bye-bye to the toy. Although he sometimes has tears in his eyes while waving bye-bye, he knows that he can’t always have the things he wants. (I also model this behavior when I am tempted by things I don’t need – although I do feel a little silly waving bye-bye to iPhones and leather boots in front of my son.)

The Bottom Line

Financial literacy is a long-term process that needs to start very early. Teaching your children money lessons, and letting them feel the consequences of their money decisions, should start as soon as your kids are able to understand what money is.

What have you taught your pre-K kids about money?

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For those of us who travel infrequently, taking a flight can be a budget minefield. It’s not just the constantly rising price of airline tickets, either.

If you don’t plan ahead the next time you fly to Aunt Sylvia’s for the holidays, you may find that the associated costs of flying — from checked luggage to parking to food — may just put a big hole in your travel budget.

Here are the ways frequent flyers keep their costs low:

1. Travel light.

Airlines charging for checked bags are nothing new anymore, but the extra charges may still come as a nasty surprise to an infrequent flyer. Make sure you know your airline’s checked luggage guidelines, including the weight limit and number of bags you may check for free or for the lowest price. Knowing what to expect ahead of time will allow you to decide what needs to be packed and what can be shipped ahead (or left behind altogether).

There are also ways to reduce (or eliminate) the fees. You can usually get a cheaper rate if you pay for it before you get to the airport, and you may even have a credit card that will reimburse you for checked baggage fees.

Want to learn how to pack lighter? Here are some tips.

2. Park far away from the airport.

The farther away you park, the less you pay for the privilege. Remote lots that are not associated with the airport are going to be a great deal cheaper than the valet parking right next to the terminal.

Research online, as there are websites you can book from that can give you an even better discount. Consider taking public transportation to the airport or hitching a ride from a friend. Uber is also an option. It takes more planning to be able to avoid the daily parking fee, but it’s certainly worth the effort.

3. Don’t eat at the airport.

Food at airports has two strikes against it: the cost is ridiculously high and the food itself is (generally) unhealthy. Since you are a captive audience, it’s very easy to fall into the expensive airport food trap, but a little planning will save you from overpriced airport nachos.

Carry portable and healthy foods with you, like apples, bananas, nuts, granola bars or even sandwiches. Bring an empty bottle to fill from a water fountain post-security, and you have everything you need for a meal. Your wallet will thank you.

4. Double-check the security requirements.

With the rules for what can and cannot go through security changing from time to time, it really pays for the infrequent flyer to find out exactly what will make it through TSA ahead of time.

For instance, after the prohibition on liquids over 3 ounces was instituted, many travelers found themselves having to give up standard size bottles of shampoo, lotion and other products because they were unaware of the new rule. Knowing what can and cannot be in your carry-on will save you money, time and aggravation.

Editor’s Note: International travelers should also be aware that you sometimes have to leave a terminal and go through TSA again when you transfer flights. I flew from Canada to Los Angeles once and had to throw away a bottle of wine I bought at duty free. The reason was that I had a layover in Las Vegas, and they had me get out of a terminal just to go to another. Obviously, I didn’t know that would happen, and I wasn’t planning to drink the whole bottle when the TSA officer wouldn’t allow me to bring a whole bottle of alcohol through security. I threw away a very expensive bottle of wine I bought as a gift, but lesson learned.

5. Bring your own entertainment.

Every airport boasts several newsstands and bookstores, as many people will forget to bring something to occupy themselves. But buying a magazine, newspaper or book (or worse, a DVD) means paying through the nose for something you could have easily brought from home.

Stop by the library a couple of days before the flight and load up on books, magazines, audio books and DVDs for free, and you’ll have a pleasant flight without spending a penny.

6. Let your purchases work for you.

Even if you are only an occasional flyer, a travel rewards credit card can help you to save up for a major trip. Since these cards allow you to accumulate points or miles toward a trip with your everyday spending, they are a good option for the infrequent flyer who dreams of traveling.

As with any credit card, however, travel rewards cards are only as good as your ability to pay them off each month. But if you are able to use these cards responsibly, you can find yourself flying free to your favorite destination.

Planning ahead will help keep associated airport costs low so you have more money to spend on the vacation itself. And isn’t that the whole point of traveling?

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Automation is a buzz word among financial advisors. And for good reason too. There are simply too many benefits of automating your finances for someone who cares about accumulating money to ignore. Whether direct depositing money into a savings or retirement account when you get paid, setting up automatic bill-pay, or investing in no-hassle index funds, automation can mean less stress, guess-work, and precious time managing your personal finances.

Complete automation can also have some serious disadvantages as well. Becoming aware of them can help you make more informed decisions about how — and how much — to use this strategy.

Here are three possible downsides to “set it and forget it” finances.

1. Losing Touch With Spending Habits, Expenses, and Savings Potential

Automation is designed for convenience, and like many other tasks that are automated in our modern lifestyles, it tends to make us lazy. Just as you spend less physical energy using an automatic dishwasher, leaf-blower, or an AI system that turns off your lights, you’ll spend less mental energy on your finances. Soon, “out of sight” becomes “out of mind.”

For example, if you set your credit card bill on auto-pay, it’s easy to lose touch with the individual categories you’re spending in from month to month. You might miss patterns that are insightful, alarming, or even encouraging. Manually releasing payments can have a beneficial “sting” effect. Being forced to engage with your bills might spur you to action, such as cutting an expensive monthly service or strategizing how to pay off your debt faster.

Automated savings takes out the need for self-control, helping people who have been otherwise unable to set aside money to create an instant savings habit. But it can also lead to stagnancy if you fail to adjust your savings to match raises or salary increases when you land a better job.

2. Getting Hit With Fees and Insufficient Payment Charges

Many people mistakenly think automation means completely hands-free, but you still need to play and be aware of what’s happening to your finances in order to avoid overdrawing your account (which is why many people schedule their bills to come out immediately after a payroll deposit). And, if your account is overdrawn for a bill payment, it can mean double charges — from your bank and your creditor or service provider.

While this downside is avoidable, it’s still something to consider if you’re not good at balancing your account.

3. Missing Errors and Signs of Identity Theft

Just as human error can be the cause of a missed payment or an over-payment, automation isn’t immune to mistakes. It’s easy for small or large errors to creep in, even when things have been working perfectly for years. The mistake could be as simple as a missing or extra zero, yet we’re all familiar with the tremendous difference a zero can make! With automation, you could be over-paying or under-paying a bill for some time before either you or the recipient notices (or chooses to inform you).

Although many financial institutions watch and report suspicious activity, identify theft is on the rise — and automating your finances can make it harder to detect. Thieves will often make tiny charges that don’t raise alarm before completely wiping your account, so unless you’re hands-on, automation could make you an easier target.

Financial Automation Is Good — But So Is Checking In

Like many things related to money management, balance is key. Whether you choose to automate all your finances, or only certain aspects of your finances, schedule time to check in. If you’ve been out of touch for a while, it might be good to start with once a week, then transition to once a month. Look for errors, track your spending habits, and note any changes to your income or expenses that impact your savings and debt-repayment potential.

By bringing oversight alongside automation, you can avoid the pitfalls of losing touch with your finances while making the most of this convenient, money-maximizing trend.

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Bursting the love bubble by sitting down and having a serious talk about finances is never fun, but open communication about money is a good idea in any relationship.

Those thinking of tying the knot should have a serious discussion about money at some point, preferably before you move in together or get married. Even if there are no plans to combine finances completely, it’s still good to clear the air and see if everyone is on the same page.

Here are five things that to talk about before moving forward:

1. Debt

One of the biggest things you need to talk about is debt. Get it out there. Even if you won’t be sharing finances, one person’s debt can have a profound impact on household finances. If you want to buy a home together or if you want to do other things, someone’s obligations can hold you back as a couple.

Have an honest talk about your debt levels, and see if you can make a plan to pay down the debt. Even if you don’t share finances, the partner without the debt is going to have to be supportive until the debt is paid off.

2. Credit

Credit goes along with debt, but it isn’t exactly the same thing. While it’s not vital that your partner have a perfect credit score, it is a good idea to see where you both stand, and be honest about the situation.

At some point, if you decide to get a joint loan together (for a car or a home), both of your credit scores will matter. Talk about it so you know what you need to do to get things up to scratch. If one of you has a poor score, you might have to wait a little longer before you accomplish some of your goals.

3. Money Philosophy

This is a bigger deal than you might think. For a long time, my ex and I struggled in our marriage because he likes things and I value experiences. Neither of us was more right than the other, but it did make for some interesting discussions when we were nailing down our money priorities.

It’s a good idea to know whether or not you have the same money values before you take that next step. Spenders and savers need to be able to come up with a plan to compromise. If you like spending your money on lots of books, and your partner prefers movies, you might need to come up with a plan to make sure you both get what you want at least some of the time.

4. How to Handle Kids and Money

If you think you’ll have kids together (and that’s another conversation you need to have before taking things to the next level), you need to talk about how you’ll handle kids and money.

Do you want to save up for college for them? How will you handle allowance? Extracurricular activities?

These are big questions you need to tackle together so you are on the same page. It’s vital to know early on so that you aren’t unpleasantly surprised later.

5. Retirement

Chances are, you both want to save for retirement. But do you have a shared vision for what that looks like? Before you commit to a long-term, life partner relationship, make sure you talk about how you want to handle retirement. It can be tough if one of you expects to sit at home most of the time, and maybe play golf a couple times a week, while the other wants to sell the house and everything in it to travel the world.

In the end, you need to make sure that everyone is on the same page so that all the money goals are being reached together. Take the time to have a discussion now so there are fewer surprises later.

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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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