The Best Personal Finance Ideas Of The Year

Nothing say Christmas like a list, so here’s another one. Here are some of the best personal finance ideas blogged this year, chosen by Mrs. Micah: Finance for a Freelance Life. Her top pick is the “debt snowflake” from the blog PaidTwice—it describes the act of finding lots of little ways to supplement your standard income, so that you can add mass to your “debt snowball” to make it more effective.

Other best ideas: charge yourself exorbitant bank fees, base your budget off an older and lower salary, use cash for budget categories where you regularly overspend, and automate your finances.

“Best PF practices of the year!” [Mrs. Micah: Finance for a Freelance Life]
(Photo: Getty)

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  1. MrsMicah says:

    Thanks Chris. It’s great to be included here.

    I’d love to hear from all of you! What do you think are the best personal finance practices of the year? E-mail me, or comment on my site and they’ll get added to the post. :)

  2. stevebmd says:

    Here’s another great idea: Don’t take any personal finance tips from M.P. Dunleavey.

  3. goodkitty says:

    How many different ways are people going to find to say “Earn More” and “Don’t Spend Money?” Besides, if you don’t buy tons of useless junk to start with, you won’t have all those e-Bay and Craigslist sales.

    Wealth-building is easy… but where you draw the line between love of money and love of life is a personal choice. I know miserable rich people and happy poor people.

  4. MrsMicah says:

    Well those are certainly two of the most important, Good Kitty, I think people have come up with some great points for the post. Things which help you earn more, or spend less (and thus save/invest more)…but which help you do it easily and happily. For example, one person posted a way to automate your finances so money goes directly to savings.

    I think it helps to outline practical steps to take to achieve those goals. :)

  5. MrsMicah says:

    *while (brain still not awake)

  6. @goodkitty: I think it helps to have different “mental tricks” available. People’s money-brains work differently, so it helps to have lots of different tricks to try until you find one you can “grok,” do consistently, and have work.

    Personally I’m big on budgeting to an older salary. When we get increased salaries, it goes either to retirement savings, long-term savings, or paying off the last of the ugly student loan, depending. If I pretend that money isn’t even there, it’s just much easier for me to budget at the smaller amount. Dunno why, just is.

  7. anatak says:

    @goodkitty: Things like “Earn More” and “Don’t Spend Money?” and “use a Debt Snowball” are really more of a ‘what to do’, where as the items listed by Mrs.Micah are more ‘how to do it’. Yes, the basics are quite simple and mostly common sense. But there are a lot of ways to achieve the same goal.

    To that point, the ‘Debt Snowflake’ is a bit flaky. its not a new concept, but rather she seems to have given it a clever name. The way Dave Ramsey has taught his debt snowball method for years has been to attack that next debt with ‘Gazelle Intensity’ – basically meaning that you scrape together every extra dollar you can get your hands on to help add more snow to the ball.

  8. richcreamerybutter says:

    I think this is a very positive list. As I’ve mentioned here before, a lot of these “get out of debt” lists seem to indicate that you need to clothe your 6 (yes!) kids in burlap sacks and pour molten lead into little toy molds by the fireplace for presents while shunning mobile phones and declaring Reagan cheese as the 5th food group (or is that ketchup??!).

    I was completely in debt until this year, and then something amazing happened; I saved $20,000 from existing cheap-ass habits I’d had all these years. Amazingly, I also seem to enjoy a certain level of decadence. I’m not sure how this happened, but if you tailor a set of habits that fit your own lifestyle you can get out of debt without feeling hopelessly depressed.

  9. richcreamerybutter says:

    OK, I’m inspired…here are some habits of mine that allow me to live under the illusion I’m “normal.” If you FEEL deprived, you will be depressed. You will then cheat on your debt “diet,” not unlike bingeing.

    1. Cook at home. There’s no excuse in this day and age for not having basic knowledge in the kitchen. Assuming you have internet access (see #2), there are many resources available for you to peruse on basic techniques. Maybe you can even find a used copy of one of the cookbooks dedicated to cooking with 3 ingredients. You can eat luxuriously at home if you know where to buy the ingredients and how to prepare them.

    As much as I love to eat out, it will get very expensive…save this for special occasions, or at least develop a taste for tasty cusines that tend to be reasonably priced. Better yet, why not treat yourself to once really nice place a month (or whatever fits your budget)?

    2. Don’t ditch your internet access and mobile phone. I don’t understand these holier-than-thou folks who claim mobile phones are “unnecessary.” Instead, get rid of the land line! After all, you can’t take it with you. As far as the internet, it can be a source of income, job networking, entertainment, and research.

    3. Prioritize your entertainment. This will keep you same.

    a) Do you need cable? I can’t answer this for you, since it may keep you from going out at night and spending even more money. Depending on the kind of cable available in your area, have you tried simply plugging it into the wall without ordering service? sometimes it works as an antenna, or you will mysteriously get free basic cable plus a few premium channels from time to time.

    b) Yes, we all have a lot of friends who constantly want us to join them for a dinner (especially birthdays). If the person isn’t a close friend, I’ll say I’m busy, but can join the party for a drink beforehand or afterwards.

    c) A nice flask is your friend. If it comes down to spending a carefully budgeted amount on 4 drinks and a lousy tip for the bartender (just an example here) or 3 and a good tip supplemented by a flask, always choose the latter.

    d) House/loft parties…BYOB is always much cheaper than bars, and it’s a great way to see a bunch of friends at once.

    e) One sacrifice I make easily without worrying about sounding like a curmudgeon is avoiding movies in theaters, with a few rare exceptions. For the price of a movie, you can see an actual live show of 3 bands! Besides, people act like animals anyway. Wait for video if you can. Maybe your city is having a screening, and you can scour the local weeklies for a chance to get a pass.

    4. Shopping – ok, if you’re a girl with access to a Forever 21 or H&M (or other chains), you don’t really have an excuse to have to spend a lot of money to look reasonably current. I realize only some of us have the opportunity to go to such places (and have access to sample sales), but those who don’t USALLY do have access to at least an outlet mall via automobile. Buy a few classic pieces as an investment, and supplement with the cheap stuff each season. If you don’t have a car (see #5), don’t feel bad about spending a little more on shoes, since they are a primary mode of transportation.

    5. Transportation – I don’t have a car, and use public transportation. Because of this, I rarely use cabs or car services. To be honest, I have lost my sense of what constitutes budgeting when you live in a place that requires a car, so I don’t know what to say about this… :)

    6. Unexpected cash – I always put some towards bills, savings, and leave a little for a treat. Like I said, it’s the moderation and occasional reward that will keep you on track.

    7. X-mas – don’t be afraid to tell your friends you’re not exchanging, or put a severe cap on the gift. They will forget about it in a month anyway.

    I have many more, but I’m out of time.

  10. paidtwice says:

    Oooo how exciting! Thanks consumerist!

    @Anatak – I don’t claim to have created the debt snowflake idea. in fact, I stated several times that many many people have used it before me. On my site I write a lot about snowflaking and people would ask me to explain what it means and why I do it, so I put together the explanation post. Snowflaking isn’t something I invented, it is just something I put into practice. A lot.

    I haven’t actually read Ramsey but I thought he created the Debt Snowball concept, but a commenter to my post said that it was actually created by the Tightwad Gazette. I don’t honestly know where it originated.