Money Hacks

You are responsible for designing your own life. When you were young, other people determined how and where you lived. But as an adult, those choices are up to you. Your choices reflect your philosophy.

I encourage you to value community and experiences over Stuff. You are not what you own; you are what you do. It took me a long time (nearly forty years) to realize this. I still haven’t fully wrapped my mind around it. But I’m coming to understand that it is relationships and experiences that give life meaning.

Money is good — it opens doors and provides options — but meaningful relationships are more important.

For the next few days, Money Hacks will be sharing some great ways to save money while celebrating the season.

My favorite gifts are those that people have made themselves. Homemade gifts demonstrate caring, creativity, and passion. We are lucky to have many crafty friends. Every year, I’m delighted to see what they create for Christmas gifts. In the past, we’ve given or received:

• A hand-assembled collection of gourmet salts, complete with written description of each.
• Ginger snaps.
• Art. (Do you dabble in photography? A framed print of your nephew is a great gift for your sister-in-law.)
• Chocolate-dipped hazelnuts (from a family with a filbert orchard).
• Home-made jams and jellies.

One year I crafted a homemade gift of my own: basil liqueur, brewed from vodka, sugar, and fresh basil from our garden. The stuff steeped for several months before it was ready to share.

Surely you, too, have a talent or hobby that you can draw upon to create gifts for your friends.

Read more DIY Christmas gift ideas.

For the next few days, Money Hacks will be sharing some great ways to save money while celebrating the season.

Gift-giving among adults can be awkward. If you spend too much on another person, they may feel uncomfortable. Many people welcome the idea of doing away with gift-giving completely. Some, like my family, establish specific rules.

We’ve made a tradition of the $5 gift exchange. We give bigger gifts to the kids and to my mother, but the rest of us exchange gifts that cost no more than $5. It’s become a game to find interesting, thoughtful gifts for just five bucks. (Or to find amusing, tacky gifts for the same amount.) The first year we did this, the gifts were kind of lame. But with time, we’ve become more creative.

Some people practice a variation of this. They do a $100 holiday, where their entire budget for a particular group (family, circle of friends, etc.) is limited to $100, and that money is divided as needed.

The goal here is not to be cheap — it’s to give thoughtful presents without breaking the bank. If your family (or circle of friends) does agree to gift-giving guidelines, don’t be the person who breaks them. People feel resentful when one person takes it upon herself to give more than the agreed terms. Stay within the rules and have fun.

Read more frugal Christmas tips.

In their book Unplug the Christmas Machine, authors Jo Robinson and Jean Coppock say that kids really want four things from Christmas:

• A relaxed, loving time with the family.
• Realistic expectations about gifts.
• An evenly-paced holiday season.
• Reliable family traditions.

The latter is my favorite part of the holiday season. When I talk to my friends about what Christmas was like when we were Children, it’s not the gifts that we remember. We recall the things we did as a family. I remember sleeping next to the tree every Christmas eve, but never being able to catch Santa in the act. I remember seeing the cousins. I remember decorating the trailer house. Your kids will remember the traditions, not the gifts.

Take 90 minutes to have a serious conversation about your household financial situation.  Set up an appointment with your significant other to review where you are at financially.  Set goals for debt reduction, setting up an emergency fund, and for saving money to purchase something you both would enjoy.  Be specific in the steps you will take to reach your goals and how you will hold each other accountable.  Be truthful about setbacks and celebrate your sucesses.

Social capital is as real as financial capital, and sometimes more valuable. 

You generate social capital when you help your neighbor repair a fence, or have your Sunday School class over for a barbeque, or join a bowling league. Any time you participate in the community, you are generating social capital, both for yourself, and for the other people involved. We don’t need to sacrifice our own interests to generate social capital. It’s not a zero-sum game. 

True wealth doesn’t come from cash, but from our relationships with the people around us.

Ignore the proverbial Joneses.

One of the most dangerous paths to clutter (and to overspending) is the urge to own the same things your friends do. Peer pressure can be powerful. I’ve come to realize that lifestyles are not a competition. What does it matter what others buy?

I’m content with what I have — more Stuff is not going to make me more happy.

While you’re still in school, networking is a great way to get a feel for the job market and possible careers.

Connect with co-workers, friends, and family members to learn about their careers and occupational status.  Conduct an informational interview with someone in a profession that sounds interesting to you.  Ask questions about educational requirements, the job outlook, the positive and negative aspects of the position, and always go away with at least three other people to contact. 

These encounters will possibly provide new job possibilities, but often times can put your current employment into perspective and give you insight into possible next steps for your career.

If you insist on borrowing money from someone close to you — such as a family member or a friend — always fulfill your end of the bargain. Put your agreement in writing. Make your payments in full and on time. Loaning money can be just as awkward as borrowing money — sometimes more so.

You might also consider scheduling a celebration with the lender when you’ve finally paid them in full.

Money can ruin friendships; don’t let it ruin yours.

Couples should strive for trust, honesty, and open communication in their finances.  Ministers report that couples in pre-marital counseling are much more willing to talk about all other aspects of their personal lives rather than finances.

But strong marriages and strong finance aren’t just for church-goers. Strong communication is the foundation of any marriage. Talking openly about money can help both partners make smart choices.