There's a difference being knowing something and applying what you know. I've always known these.

I only apply 3 of them. (Shame on me...)

A lot of things in retrospect seem "duh! wasnt that obvious?" but when one is actually in the middle of the action, these things kind of start to fray around the edges, or you just ignore them for some inexplicable reason.

Personal Example: I did not have rental reimbursement on my auto insurance till (very) recently. I have no fraking idea why I did not go with it to begin with (saving a few bucks, most likely). And guess what.. just a week before the old policy expired... fender bender. And now I have to shell out 130 bucks out of my pocket because I wanted to save like 30 bucks on the 6 month premium. In hindsight: "What the frak was I thinking?". And I even considered upgrading the policy for the remainder of the term to include rental. But again, I was like "meh, we'll just get it with the new one" (yes, I talk to myself as "we" and "us".)

In hindsight, the whole reasoning makes no sense whatsoever. Yet at that time, I just shrugged it off.

Oh sure we all knew this before but we listened to all the experts who told us "this is a new economy", "the old rules don't work now", etc etc etc.

See rule #1

MSN Money? Their articles are generally drivel.

Number 7 - There is NO SUCH THING as unconflicted advice on Wall Street.Everybody has an angle.

I'm not sure that #4 is a very good idea. Actively pay attention to how your asset mix matches your retirement goals, but trying to time the market is a BAD idea. If you are young, just let the money sit.

@Snarkysnake: But Jim Cramer always tells me the truth. I know because he yells.

@MostlyHarmless: I see this differently. We have two reputable (from what I've heard) body shops in our area. One offers free loaners and one doesn't.

We happened to choose the one that didn't for some relatively major body work (deer hit) and I learned a bit about the process. While they don't advertise a free loaner, the person working with us admitted that they will either set a customer up with an "owner's car" that they keep on hand or pay for a rental from Enterprise if necessary. They have to do this or risk losing business to those offering free loaners.

The advantage for them is that if a person walks in with rental coverage, they get to pocket the money in their pricing structure for a rental and have extra profit. If the person doesn't, it's already covered.

At least in this situation the rental insurance is just a waste of my money each 6 months with the only benefit to the body shop.

8. don't buy shit that you don't need and/or won't use

@SWBLOOPERS: Yeah, I know what you mean. Though for these 6, lets see:

1. Yeah, for some reason I never quite liked listening to the tv experts about financial advice. I didnt explicitly think they were wrong or lying, but I simply did not feel like their "advice" would be particularly relevant in my case. (Not having money helped).

2. I always LOVED budgeting. Yes I am one of those weirdos. I like the whole logistics and resource allocation thing. I used to spend hours tweaking and figuring out my budget even before it became cool to have a budget.

3. I am not really great at bargaining, but I do fish around for better rates, and sometimes if it seems worth it, I try to negotiate a better deal.

4. Didnt have one till after the financiapocalypse. Though if I did have one, I would have managed it actively.

5. Don't have one. Never quite understood the "housing as an investment" plan. ("what if theres a flood and the neighborhood goes down the crapper?" was my first Q when dad told me about it.)

6. Having a negative net worth scared the shit out of me when I took the car loan. Since then I have worked aggressively to get it into the positive territory. Very recently discovered that not only was in in the black, but also I had buffers beyond it. Phew.

@FatLynn: IMHO "timing the market" is different from "managing your portfolio".

What you should be doing is to make sure that you have a proper mix of investments of varying risk levels. That and if you see trouble coming from a mile away, move to mitigate it.

@dohtem:

Wasn't it Cramer that last year about this time got all emotional , started to tear up and tell people that they shouldn't put any money that they cared to see again in the stock market for like , five years ? Or maybe it was the Cramer that will go on CNBC tonight with a vaudeville act/stock tout show ringing bells , honking horns and generally acting a fool while naming no less than 1-15 stocks the he "likes" and that we should buy ?

4. Actively manage your investment accounts.

Um, this is not good advice. Active management is exactly what you want to avoid unless you are a sophisticated hedge fund with mountains of computational resources and the ability to execute split-second trades.

The only reasonable point they have here is rebalancing your retirement accounts, which isn't really active management--just something you do on a regular schedule according to a pre-defined plan--and can often be done automatically.

And how has the recession taught us this lesson, exactly? People who panic about big market drops and yank all their money out of stocks after the fact are the ones who lose the most money.

@MostlyHarmless: It's all about mathematics.

Let's say that you spent 30 bucks each 6 months and that you go 3 years without needing to take advantage of the rental car coverage. You've just spent $180 for something you haven't used. Even if you have to shell out $130 for a rental once every three years, you are still coming out $50 to the good by not carrying the coverage.

Now if you are having more than one wreck every three years then it seems something else may need to be looked into. (That still seems to be a pretty high rate, one wreck every three years.)

@Snarkysnake: *sigh* I guess I needed the /sarcasm tag.

@ShikhaCadimillac: That exactly is the concept of insurance, isnt it :P

And the thing is you never know how you will get into a wreck or a car-less situation (someone else's fault/tree fell on the car).

Now its moot though, since my premiums are down to a much much lower range, and the rental add on does not cost nearly as much.

@dohtem: Not really. It was fairly obvious from what I saw. Esp the "I know because he yells. " part was a dead giveaway.

@GuidedByLemons: Well I think Actively manage it is to actually look at it and change which fund you have it in based on what they are doing with your money. Looking at your retirement accounts quarterly and monthly and changing the balance between them is a good idea. As opposed to a lot of people with 401ks who just set it and forget it.

I would like to add:

7. The price of ANY asset can drop significantly while debt balances remain the same.

And it ought be high on the list, too.

I don't really see this sort of thing covered when it comes to online financial planning calculators, but there ought to be some rules regarding mortgage debt relative to age as well as income (a 55 year old should have a lot more equity in their home than a 35 year old). And there ought to be a serious examination of asset to debt ratios, too (aka leverage). Someone with 300k in assets and 50k in debt is worth 250k, and so is someone with 800k in assets and 550k in debt. But, regardless of income, the first person is in a much stronger position should the price of the assets drop.

@dohtem:

Oh , your point was well made. I just can't let Cramer have a pass because he is dangerous to anyone that does not have enough money to just shrug off their mistakes. People are losing money chasing his clunkers that they will need in 20 30 years to live on in retirement when he will just be the answer to a trivia question.

2. Budgeting is cool.

I was just talking to my dentist (between rinsing and spitting etc.) about this. Our tiny state is in big-time trouble with unemployment, budget deficits, foreclosures, etc. It's as if Detroit were a state.

Anyway, after sharing our personal woes, mostly my family's because my dentist is doing just fine, I said that the *only* silver lining I could see was that we got used to living more frugally.

But then, that doesn't help a consumer-based economy recover quickly, does it. People need to buy stuff to restart the engine of capitalism, blah blah. So, while living frugally is a personal point of pride, it's not necessarily a good thing for the nation right now.

@ElizabethD: Show me a country where the majority of the populace does the above, and I'll show you a country that's economically sound. Want to really "stick it to the man"? Live frugally.

@Snarkysnake: What will the question be?

@sonneillon: I took it to mean be involved with your investments. As opposed to my mother, who trusts someone else to do everything related to her investments, and has no idea where her money is or how well it's doing.

@gStein: I think that should be #1.

Not sure the USA is ready for #5, or if this recession even changes anything...

A big part of most upwardly-mobile people's retirements has been the house. Start with a small home, use the equity to buy a larger home as your family grows, then sell and downsize as you become an empty-nester, while the money from the downsizing funds your retirement.

What would the world look like if house prices never increased?

And did this recession change anything, other than those who bought just before the recession began are screwed? If you bought 5 years ago, no big deal - your $100K of equity is just $20K. Still a net gain...

#9 - accept the fact that you can't have everything you want, even if you feel like you really, really deserve it. Maybe if you plan and save you can have/do most of the stuff you want, with enough time, but you'll probably never get everything.

I'm struggling with this a bit myself - now that I'm out of debt and saving towards some specific goals with a very decent paycheck, I have to keep reminding myself that even though I've been working hard, I can't afford a vacation - not if I want to get some new clothes. And I can't go out for drinks all the time, not if I want to keep saving towards a house. It's a luxury being able to decide which of many wants I can satisfy, obviously, but it's suprising how easy it is to justify various purchases. Constantly reminding yourself that you can't have it all is tough - but neccessary.

It's #9 because it's after gStein's well-put #8 above.

"The experts are often wrong." - who made this list?

@MostlyHarmless:
Rental reimbursement (at least on my policy) is so cheap that I always opt for it. Now uninsured/underinsured is a different story. If I lived in a state that had UMPD, I'd buy it. But since I don't, I never purchase it.

@Trencher93:

Someone who hopefully isn't an expert, otherwise according to his list he'd then be full of shit.

@gStein: This is one of the ways I always pick out things...asking my self "is this something I want or something I need?" and also "will I still continue to use this 6 months from now?"

Works for like 90% of those items you're about to purchase.

@Bahnburner: I have heard that savings rates in other countries (European and China come to mind) are much higher per person than in America.

Maybe there is some logic to saving after all

One look at the volatile national savings rate should tell us that A) "We" didn't already know that and B) "We" are not done learning.

This excludes anyone reading the consumerist of course!

"6. Stay healthy, stay solvent. People who get regular exercise are healthier -- mentally as well as physically -- than people who don't. They live longer. They're happier. Their brains even work better. Exercise need not cost you a penny, whereas poor health is very expensive. If a serious recession has any silver lining, it's the realization it brings that your quality of life is largely up to you."

Am I the only one that finds this insulting.? It implies that those of us with serious health problems made bad choices, and therefore, are drags on the economy, health care, etc. I'm sorry I was born with have spinal stenosis, I'm sorry an 80 year old man too confused to drive safely ran me over, I'm sorry I was assaulted by a patient at work...

@MostlyHarmless: That's smart of you. When I worked for a car rental place that did most of its business in replacement (hint, hint) I often saw bills going into the hundreds even at subsidized rates.

I also had people without rental coverage pay retail and the bills approached $1,000 per incident. Then they would battle it out with their adjuster to try to have it covered :( Better to just pay the extra couple bucks a month IMHO.

@JennQPublic: That is kind of what I was inferring but I was just being more specific.

@Bahnburner:

So, what do people do for jobs in those countries where retail isn't a key element of the economy?

Obviously I never took Econ 101.