Widen the Gap with Homemade Bread

If you’ve read my book7 Money Rules for Life, you know that Rule #1 is so simple it would be easy to overlook it as being too elementary. Here it is: Spend less than you earn.

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Now think about it … “spend less than you earn” is not the same as “don’t spend more than you earn.” That implies it would be okay to spend all that you earn, but no. The operative word is “less.” You need a gap between what you earn and how much of it you spend. That is the fundamental secret for living below your means.

It’s in that gap that financial freedom can grow. You really need to read the rest of the book, but for now let’s just say that growing the gap is the challenge.

Here’s an easy way to increase your gap this week—even if only by a few dollars, because it all adds up: Make your own bread. Wait! Hear me out. I have a recipe for you that is so amazing, so simple and so foolproof you’ll be tempted to call it Einstein Bread because it’s going to make you feel like a genius.

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Foolproof Plan for Saving $10,000

The most important thing you can do to make your personal economy strong is to have an umbrella—a Contingency Fund with at least enough money to pay all of your bills for three to six months without a paycheck. Call it $10,000.

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SAVE 10% OF YOUR PAYCHECK. It may sound like a lot, so if you can’t do 10, start with 5% or even 1% percent and build up. Deposit the money automatically into your Contingency Fund; you won’t miss what you don’t see in the first place. Okay, you’ll miss it for the first few weeks, but soon you really will not miss it.

GET RID OF NON ESSENTIALS. Give up the little things, such as cable TV, eating out, gym membership and entertainment.

CUT VARIABLE EXPENSES. You can’t cut off your utilities, stop eating or give up driving. But you can reduce the cost of the food, energy and fuel you buy. Opt for the cheapest supermarket and gas station. Turn out the lights; run only full appliances.

QUIT SMOKING. This suggestion requires no explanation. Although it does beg the question, who can even afford to smoke these days? At about $7 for a pack of smokes (U.S. average) that’s a $2,555-a-year habit. And in New York City it’s double that. Yeah, $14 a pack.

STOP PAYING BANK FEES.  If you’re paying a $7.95 (or higher) per month fee for the privilege of maintaining an account, stop! Open an account at an online bank (they pay better interest rates anyway), like Ally Bank, that doesn’t charge a monthly maintenance fee for checking or savings accounts. Or check with a local credit union for free personal checking accounts. Some banks even offer free business accounts.

PULL BACK.  Stop sending more money than required each month to your credit-card companies, mortgage lender or any other creditor. It’s admirable that you’re being diligent in repaying the debts, but if you continue to do this while living without money in the bank, you’ll be setting yourself up to fall even deeper in debt.

CLEAN OUT. Take a look through your cupboards and closets. Identify everything you haven’t used in the past six months. Turn what you don’t need into cash on a website like eBay or Craigslist or hold a yard sale. Or donate to an IRS qualified chartiable organization and take a tax deduction for each item’s fair market value when you itemize your federal tax return. You’ll maximize your deduction (which means you’ll reduce the amount of tax you owe) with “Money For Your Used Clothing,” a certified and guaranteed workbook that helps you determine the highest market values that the IRS will allow. You can order online or call 800 550-3502 Mon.-Fri., 8:30-5 MT.

ADJUST WITHHOLDINGS. Use the 2016 Federal Withholding Tax Calculator to make sure you aren’t having too much or too little income tax withheld from your pay.

INCREASE YOUR INCOME. Get a second job. Or third. Work more hours at your current one. Get creative by making money doing things you already love to do, like dog walking or selling handmade items.

GIVE UP YOUR LANDLINE. Over 38 percent of American adults have given up their land-based telephone service. Are you in that group? If not, why not? Basic service costs at least $25 per month in most markets.

TAKE YOUR LUNCH TO WORK. Have you figured out what you’re spending per year on eating lunch out? At $10 a day, you’re spending $2,500 after-tax dollars on lunch. Just think of all the dinner leftovers you throw out that could easily be tomorrow’s lunch.

STOP AT THE MATCH. If you are contributing to a retirement account like a 401(k) or 403(b), don’t stop now, but limit your contribution to the amount your employer matches. Ask your employer how to adjust your contribution. Once you have save to your goal, you can always change your contribution again.

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Would You Rather … ?

I’ve been thinking a lot recently about (what else?) debt. It’s not the most joyous thing to have on one’s mind, but that’s what I do. I eat, think, write, breath and even sleep the subject of debt.

And yes, I have been in horrible, worse that debilitating debt where you feel like your creditor owns your soul and you are locked in the steel trap. I know what it’s like, and by God’s grace I am no longer there.

The best maintenance program for me is right here―in the work that I do (that eating thinking breathing sleeping thing I just mentioned). Maybe it’s like being a Weight Watcher lecturer. The work you do keeps you on track because your mind is always engaged in the subject matter, and you know everyone is watching.

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It’s been a few years since I asked you simply, “If all you had to do to be debt-free was to stay away from your family and friends for one year, would you do it?” It was a simple question, but boy did it bring on some heated responses, especially from our DPL Facebook fans.

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How to Do Christmas Without Debt—Plus a GIVEAWAY!

If you are, or ever have been plagued by consumer debt, I can nearly guarantee expenses related to Christmas have contributed greatly to that miserable situation. You know I’m right and unless we do something to stop that pattern, things are about to get much worse for you. Christmas is right around the corner.

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The problem is procrastination. Face it, when it comes to Christmas, the longer you wait, the more you’ll spend. The opposite is also true. The sooner you get started, the less you’ll spend.

There are simple things you can do to stop procrastinating.

Get started. Do something to get moving. Once you are in motion, it will be easier to keep going.

Write it down. Reduce your plans to paper. Seeing things in black and white eliminates the unknown and provides a realistic playing field. Set reasonable limits both in time and in money.

Work with the time you have. Make a simple time line, then break the project down into small, manageable parts. Even five minutes is enough time to get something done when you have a plan.

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Wallpaper Removal—It’s a Messy Job!

A letter in my inbox this week sent me into hyper memory mode. For a few minutes I re-lived that day, back when wallpaper was all the rage; when I decided to paper our dining room in a lovely orange and yellow floral stripe. I know. But it was right in vogue at the time.

Anyway, it took me all of one Saturday to get the job done, but I did it and it looked fantastic. The next morning I rushed in to admire my handiwork only to find every lovely floral square inch of paper on the floor.

I raced to the home improvement store to get the strongest, heavy-dutiest, waterproof, wallpaper paste I could find. This was not going to get the better of me. I was determined to make that paper stick both now and for all eternity. While I had no intention of ever removing it, I do feel bad for the people who bought the place. Orange and yellow floral stripes are not exactly a timeless decorator look.

Dear Mary: Is there any easy and quick way to remove wallpaper and the paste from bathroom walls? Mickey 

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Dear Mickey: The answer to your question depends on how the wallpaper was applied. If it was pre-pasted paper, it should come off quite easily. However, I’m going to guess that since this is a bathroom and a bathroom can get hot and humid, your wallpaper was applied with heavy-duty paste, which could present a big challenge.

Perform a test using a strong solution of white vinegar and water (say, 2 cups of vinegar to a quart of hot water) in a spray bottle. Spray this on a small section of wallpaper and really saturate it well. This will soften most pastes so you can easily scrape the paper and backing from the wall. Work in small areas, removing the paper and paste completely, then moving on to another small area. But again it depends on the type of glue that was used and how old the wallpaper is.

If a strong vinegar solution doesn’t work or you find it just too tedious, a wallpaper steamer like this Wagner 1-Gallon Wallpaper Steamer may do the trick. If this is a one-off kind of job and you don’t see any point in owning a wallpaper steamer, you should be able to rent a steamer from a tool rental company in your area.

If you want to get this job done quickly with minimal mess, I’d spend a few bucks for a product called DIF Wallpaper Stripper by Zinsser. DIF comes as a concentrated liquid, a gel and also a fast-acting spray. You can find DIF at stores like Home Depot, Lowe’s and online.

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Best Inexpensive Sewing Machines

Turning 7 years old is a big deal on its own but for me it was even better because I would be old enough to join 4-H—America’s largest youth development organization, which is still alive and well after all these years, empowering nearly six million young people across the U.S. with the skills to lead for a lifetime.

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Unlike most 4-H Clubs these days, mine offered only one program—sewing—and that was just fine with me. I was so excited because I would learn to operate a real, full-size, electric sewing machine.

My first project was big square dish towel. My task was to turn and hem on the sewing machine, all the way around which seemed like miles at the time, without any stitches slipping off the edge. It took forever, but I did it. Every inch of that hem brings back a flood of joyful memories. What an accomplishment. Next up? An apron. I did that too, and with that I began to form a life-long love for sewing. 

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How I Curb the Urge to Quit

I wouldn’t tell just anyone what I’m about to tell you—and only because we’re like family. At least several times a week I want to quit. Seriously. The thought crosses my mind, and not when things are going great. It’s when I face a challenge: a tough writing assignment, a book deadline, an early morning interview or snarky message in my inbox.

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The temptation to quit is a recurring theme. And if the voices in my head don’t give me enough trouble, the voices in the culture finish the job. “Quit already! There are so many others with younger, fresher voices better able to reach the younger generation. You deserve a break! Take it easy on yourself, go and enjoy your life.”

This is nothing new. I’ve been dealing with the urge to quit for a long time. I can anticipate its arrival. And because of that, I’ve learned ways to deal with it before it drives me to the brink of resignation.

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A Simple Way to Be Smart About Your Money

Join us in welcoming avid reader and reviewer, Jeff Tompkins, Jr. Jeff’s thoughtful yet entertaining Book Reviews will appear on selected Fridays, starting today. You can meet Jeff up close and personal in his biography, below. 

The One-Page Financial Plan (Portfolio / Penguin 2015) by Carl Richards
Reviewer: Jeff Tompkins, Jr.

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My mother often describes my personality as microwave. I have little patience for the slow cooker; I want it now and with as little effort as possible. And by it I mean anything that is important at the moment.

When a book touting a “one-page financial plan” was recommended to me, you have to know it sounded like a match made in heaven. What I got from The One-Page Financial Plan wasn’t a magic key to a life of champagne and caviar. I got a very smart and simple reminder of the first step we all have to take as we wade into financial planning: relax.

Walk through Barnes & Noble, browse Amazon or even turn on any number of cable TV shows and you will quickly see what the author refers to as the massive financial entertainment industry—the countless “experts” barraging us with hot stock tips, the smartest money moves; the fool-proof places to put our money.

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