RPF0508-Three_Ways_to_Save_Money
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00:00:15.000 | Today on Radical Personal Finance, how you can save money this year.
00:00:20.000 | The fundamental principles of how to save.
00:00:25.000 | [Music]
00:00:41.000 | Welcome to Radical Personal Finance, the show dedicated to providing you with the knowledge, skills, insight, and encouragement you need to live a rich and meaningful life now while building a plan for financial freedom in 10 years or less.
00:00:52.000 | My name is Joshua, and today as we begin the new year, we're going to talk about spending.
00:00:57.000 | I don't know about you, but I just finished up a review of my 2017 expenditures, and frankly, a little annoyed with how high some of them were.
00:01:06.000 | So let's start with cutting those down.
00:01:08.000 | [Music]
00:01:14.000 | During the new year, one of the tasks that I do in preparation for doing taxes is I go through and I do a review of all of my expenditures of the previous year.
00:01:23.000 | I make sure that my business accounts are all fully accounted for, that my profit and loss statement is completed, and kind of analyze the year on the whole.
00:01:31.000 | That's obviously very convenient to do on a calendar basis.
00:01:34.000 | I use calendar year accounting in my business.
00:01:36.000 | So that's very convenient to do on an annual basis.
00:01:39.000 | And then in my personal expenses, do the same thing.
00:01:41.000 | I look and say, "Okay, how much profit did I earn? What were my expenses? What was my savings rate, et cetera? How did the year go?"
00:01:48.000 | And I try through the year to keep on track of things.
00:01:51.000 | I try to – I could pull a report every time.
00:01:54.000 | I could pull a report of today or this week or this month.
00:01:57.000 | But often it gets away from me, and I often don't home in as quickly as possible.
00:02:03.000 | And there are seasons in which expenses are heavier, and there are seasons in which expenses are smaller.
00:02:08.000 | And so when I look at the year, I usually get a little bit annoyed, and I just think, "Man, that seems like a bigger number than it should be."
00:02:14.000 | That's been my experience the last couple of days, to zoom in on a couple of categories of my expenditures and just recognize, "I wish that were smaller."
00:02:22.000 | Because every dollar saved is a dollar in my pocket.
00:02:26.000 | It's a dollar closer to my financial wealth goals.
00:02:29.000 | And frugality is the cornerstone of wealth.
00:02:33.000 | It really is.
00:02:34.000 | And frugality is important if you are just getting started in your wealth journey and you're saving your first few dollars.
00:02:40.000 | Frugality is the foundation of you being able to save money to start to get ahead.
00:02:44.000 | And then as you start to get ahead, you still have to be frugal consistently over time.
00:02:49.000 | And no matter how wealthy you are, if you want to stay wealthy, you will always need to be frugal.
00:02:55.000 | Now, your standard of frugality may change a little bit, but the principles of frugality are the same.
00:03:01.000 | You may think that rich people just spend money left and right without thinking about frugality.
00:03:06.000 | If you think that, you'd be wrong.
00:03:08.000 | Rich people don't.
00:03:09.000 | Rich people think carefully about every dollar they spend and they try to get the maximum bang for their buck.
00:03:15.000 | Certainly, as your wealth grows, you can upgrade your lifestyle.
00:03:19.000 | You may have some fancier things or do some fancier things, but at the end of the day, you want to get a good deal.
00:03:26.000 | And millionaires are known for being obsessive about cutting costs because cutting costs is one of the areas where you can exercise tremendous control.
00:03:36.000 | So wherever you are now, you're broke, trying to figure out how to get unbroke, doing okay, trying to figure out how to keep doing okay,
00:03:45.000 | or you're doing great and want to make sure that you do even better, home in from time to time on frugality
00:03:52.000 | and recognize that frugality can be applied at every level.
00:03:59.000 | If you're buying a $1,000 car, you want to get a good deal.
00:04:02.000 | If you're buying a $100,000 car, make sure you get a good deal.
00:04:07.000 | If you're buying a $100,000 house, get a good deal.
00:04:10.000 | If you're buying a million-dollar house, get a good deal.
00:04:13.000 | Deals matter even as the scale changes.
00:04:17.000 | Well, as I was considering my expenditures for the last year and thinking about the categories that I would like to improve on,
00:04:24.000 | I started homing in and saying, "Okay, well, how can I improve?
00:04:29.000 | What can I do?"
00:04:30.000 | And I thought through the process that I use, and I want to share that today with you, the three basic ways to save money
00:04:36.000 | because I find this to be a very useful way of thinking, a very useful way of approaching the problem
00:04:45.000 | because it gives me ideas and it helps me to save money.
00:04:49.000 | Speaking simply, one of the strategies that I use is to continually home in on some area of financial – of my financial picture.
00:04:58.000 | And I think a good way to do this is essentially monthly, is to pick an area in your budget,
00:05:04.000 | whether on the income side or the expenses side or the investment side,
00:05:08.000 | and try to focus in and say, "What could I do this month to improve things?"
00:05:12.000 | And that's usually the most easily done in the area of expenses.
00:05:16.000 | But you have to have a way of thinking it through.
00:05:19.000 | And so if you're doing this in the area of expenses, I often suggest to people that they just simply pick a category of their budget.
00:05:26.000 | If it's a big category, do some research on it.
00:05:29.000 | If it's one specific thing, just home in on one specific part of a category.
00:05:35.000 | For example, one of my annoyances for this last year – it seems like it's been a continual annoyance for me –
00:05:41.000 | has been the amount of money that we spend in my family on food.
00:05:45.000 | And I don't think it should be as high as it is.
00:05:48.000 | And so in looking at that, my wife and I were talking about what can we do to cut it down.
00:05:55.000 | Now the first thing I realized is one of the reasons that my food bill constantly looks high is because I don't do a good enough job of separating out the different subcategories of food.
00:06:04.000 | It's very easy if you go down to the grocery store or go down to the warehouse store to toss things in your cart that aren't specifically food items.
00:06:13.000 | Roll of paper towels, box of toilet paper, tray of water.
00:06:17.000 | Those types of things may have all different uses but they're not specifically food.
00:06:22.000 | And so I started to be very careful about breaking them out so I can fundamentally identify what's the problem.
00:06:28.000 | Is the problem that I'm putting in there all kinds of paper goods and missing things that are –
00:06:33.000 | you go down to Costco to go grocery shopping and you wind up picking up an extra hard drive for your computer to use your backup system or maybe an extra SD card, that kind of thing.
00:06:41.000 | Well, those add up quickly.
00:06:43.000 | Or a kid's toy or some books for the children.
00:06:45.000 | Those things add up quickly and that's not food.
00:06:47.000 | And so am I not doing a good enough job of carefully delineating that or do I actually have a problem with the food?
00:06:53.000 | So you can do it at the macro level or you can start to zoom in.
00:06:57.000 | Let's say you say, "Well, my food budget is pretty much in hand but maybe there's a category within my food budget that I can focus on."
00:07:04.000 | One example based upon what I'm about to do for you might be something like coffee.
00:07:08.000 | You say, "You know what? I feel like we're spending a little too much money on coffee.
00:07:11.000 | Is there a way that I could get the same experience of what's important to me at a cheaper price?"
00:07:16.000 | So in thinking about that, I thought about the three ways to save and here they are.
00:07:21.000 | This comes by way of inspiration and teaching of Amy Decision.
00:07:27.000 | I'm going to be reading today right out of her book, The Tightwad Gazette, The Complete Tightwad Gazette, with the example that she has in there because I want to use her examples.
00:07:36.000 | I pulled it out this weekend and went and found it and read it and it's just so good.
00:07:40.000 | Instead of me giving you all my examples, I'm going to use her examples to teach you.
00:07:46.000 | If you're not familiar with Amy Decision, first of all, her name is spelled in a strange way or an Eastern European way.
00:07:53.000 | I think her husband is Ukrainian, D-A-C-Y-C-Z-Y-N, Decision.
00:07:59.000 | She for years, for about six years, wrote a book – wrote a newsletter called The Tightwad Gazette and it was promoting frugality and thrift.
00:08:07.000 | She's hardcore. I love how hardcore she is.
00:08:10.000 | She and her husband did this newsletter for six years and then they had lived prior to that time on his salary.
00:08:17.000 | He worked for the United States Navy.
00:08:19.000 | They here never earned more than $30,000 per year.
00:08:22.000 | They wound up having six children total and they were able to support their family on his salary and still save a huge amount of it for their dreams towards retirement, towards purchasing a large house and a barn that they were working towards.
00:08:35.000 | And then they experienced tremendous financial success with the publication of the newsletter.
00:08:40.000 | They ran that for six years and then she retired from that, closed down the newsletter, and they have been retired ever since.
00:08:46.000 | I tried to get her on the show for Radical Personal Finance.
00:08:49.000 | I was able to track her down with the help of a listener and I tried to get her on the show.
00:08:54.000 | I wound up speaking to her on the phone for about an hour, but she didn't want to come on the show.
00:08:58.000 | For her, the biggest challenge of building this huge business, she did not enjoy interacting with the media.
00:09:04.000 | She didn't enjoy doing the public appearances.
00:09:08.000 | She didn't enjoy how she was treated by people who would consume her information and she just didn't enjoy that part of the business.
00:09:14.000 | Now she did it when she needed to, but in retirement, she just wasn't that interested in coming on for additional media, which of course, that's the whole point of being retired.
00:09:24.000 | So you're in a situation where you don't have to if you don't want to.
00:09:27.000 | This material today comes from the compendium of her book, of her newsletter, The Complete Tightwad Gazette, and it's excellent.
00:09:35.000 | The Complete Tightwad Gazette is one of the very few living books for you Charlotte Masonites, one of the very few living books that I know of that's related to money.
00:09:45.000 | Here are the three basic ways that you can save money.
00:09:51.000 | Number one, you can buy it cheaper.
00:09:57.000 | Number two, you can make it last longer.
00:10:03.000 | Three, you can use it less.
00:10:09.000 | These are the three ways to save money on something.
00:10:11.000 | Again, number one, buy something cheaper.
00:10:13.000 | Two, make something last longer.
00:10:16.000 | And three, use it less.
00:10:19.000 | Now of course, using all three strategies just simply might not work or even be a good thing to do in all situations.
00:10:27.000 | You shouldn't, if you're buying toothpaste, you shouldn't brush your teeth less just because you can save on toothpaste by not brushing your teeth less.
00:10:35.000 | Or maybe you prefer the taste of something that's more expensive than something cheaper.
00:10:40.000 | And so for you to reach a satisfactory level with the quality of your purchases, you need to go ahead and spend more.
00:10:47.000 | But if possible, try to combine all three of these strategies in any area of your budget accounts.
00:10:54.000 | If you can combine all three strategies, you can achieve tremendous results.
00:10:59.000 | Let's start with her first example.
00:11:01.000 | From her book, Amy writes that the first example is you currently wear out one $75 pair of business shoes every six months.
00:11:11.000 | If you do that, your annual shoe cost for business shoes is $150.
00:11:18.000 | For years, I wore shoes that grew out of shoes so fast.
00:11:21.000 | And then finally, I did start when you wear office shoes, especially men's dress shoes with leather soles.
00:11:26.000 | You wind up wearing through the soles remarkably fast.
00:11:31.000 | And for the years that I wore a suit and tie to work every day, it wound up being a significant expense to keep the shoes looking great.
00:11:38.000 | So here are some examples of strategies.
00:11:41.000 | Strategy option one as a way to buy the shoes cheaper, one, buy it cheaper, is before your shoes wear out, you find a sale of your favorite brand for $60 and you buy two pairs.
00:11:53.000 | If you implement that strategy, strategy one, instead of your annual cost being $150, because you bought the shoes on sale, your annual cost now drops to $120.
00:12:07.000 | It's a good way of saving.
00:12:09.000 | Now, strategy number two in order to make your shoes last longer would be that you can double the life of the shoes by getting them reheeled for $10.
00:12:19.000 | That's easy to do.
00:12:20.000 | Take them to a local cobbler.
00:12:21.000 | And by the way, while you're there, go ahead and have some rubber soles put on underneath the leather.
00:12:25.000 | That's what I used to do to make the shoes last longer.
00:12:27.000 | But if you can double the life of the shoes by getting them reheeled for an additional cost of $10, your annual costs will drop to $85 instead of $150.
00:12:40.000 | $85 because, of course, you're buying a pair of shoes for $75 and then you're spending $10 to get them reheeled.
00:12:47.000 | And so now your annual cost is $85.
00:12:51.000 | Strategy number three in order to use them less would be to double the life of your shoes by wearing last year's old shoes for street use.
00:13:02.000 | In essence, having two different pairs of shoes.
00:13:04.000 | If you need to walk a long distance, use some of your older shoes.
00:13:08.000 | And then when you need to look nice, put on your nicer shoes.
00:13:11.000 | Well, if you were to implement that strategy, using the shoes less, as a way of doubling the life, you would cut your annual costs to $75.
00:13:22.000 | All three of these are good strategies.
00:13:25.000 | And they're ways of buying the shoes cheaper, making the shoes last longer, and using the shoes less.
00:13:31.000 | And they all have a way of saving money.
00:13:34.000 | But the power comes when you start to do these things together.
00:13:38.000 | So remember our baseline scenario is $150 per year of shoe costs.
00:13:42.000 | You wear a new pair out every six months and they cost you $75.
00:13:46.000 | If you combine strategy number one, the buy it cheaper strategy of buying the shoes on sale at $60,
00:13:53.000 | and strategy number two, the make it last longer strategy of getting the shoes reheeled for $10,
00:13:59.000 | your annual costs now drop to $70 per year.
00:14:07.000 | If you combine strategy number one, buy it cheaper, which is buy the shoes on sale for $60,
00:14:13.000 | and strategy number three, which is double the life of your shoes by wearing last year's old shoes out on the street,
00:14:20.000 | your annual cost drops with those two strategies together to $60.
00:14:28.000 | And if you combine strategy number two of make it last longer, which was getting the shoes reheeled,
00:14:33.000 | and then three, use the shoes less by wearing the old shoes for street use,
00:14:39.000 | your annual cost drops to $42.50.
00:14:43.000 | But if you put all three of these strategies together and you use all three of them,
00:14:48.000 | your annual shoe cost would be only $35.
00:14:55.000 | That's the power of thinking from all three perspectives.
00:15:00.000 | You go from an annual shoe cost of $150 to an annual shoe cost of $35.
00:15:09.000 | Now these three strategies, buy it cheaper, make it last longer, and use it less,
00:15:14.000 | can be applied to almost any area of your budget.
00:15:18.000 | Our next example is coffee.
00:15:20.000 | You're currently buying one can of coffee per month at $5.12 per can.
00:15:26.000 | Here are your three strategy options.
00:15:28.000 | Strategy number one, to buy it cheaper, you switch brands of coffee
00:15:32.000 | and make sure that you're making your purchases with a coupon to get them cheaper.
00:15:37.000 | Well, if you do that, switch brands and buy with a coupon,
00:15:40.000 | you could cut your coffee expense from $5.12 per can to $1.18 per can.
00:15:45.000 | Very doable with coffee coupons.
00:15:48.000 | And I'm sure her examples came from a specific transaction that she observed or studied when she wrote it.
00:15:54.000 | Strategy number two for coffee, to make it last longer,
00:15:57.000 | you could make your coffee go farther by reusing your grounds
00:16:00.000 | with half as much fresh grounds added to the old one to get the same strength of coffee.
00:16:06.000 | Well, if you were comparing that to your original monthly cost of $5.12 per can,
00:16:11.000 | that would save you 50%, which would drop your cost down to $3.84 per month with that strategy.
00:16:20.000 | And then number three, use it less, would be you decide to drink half as much coffee.
00:16:26.000 | That cuts your expense down to $2.56 compared to the baseline.
00:16:31.000 | Now, if you put strategies one and two together, $0.88 per month, budget cost,
00:16:36.000 | one and three is $0.59 per month, two and three is $1.92.
00:16:40.000 | But if you combine all three of those strategies to buy it cheaper,
00:16:43.000 | make it last longer, and use it less, your resulting monthly cost plummets
00:16:47.000 | from $5.12 per month for coffee to $0.44 per month for coffee
00:16:55.000 | because you've applied all three of those strategies.
00:16:59.000 | Do you see how powerful the multiplying effect is of thinking not just of how to get it cheaper
00:17:06.000 | or how to make it last longer, how to use it less, but by bringing together all of them?
00:17:12.000 | Our next example is your monthly gasoline cost.
00:17:16.000 | Example, you currently spend $70.5 per month for gasoline.
00:17:19.000 | Strategy number one, to buy it cheaper, you switch to pumping your own gas
00:17:23.000 | and you learn where the cheapest stations are and fill up when in the area for a 10% cost savings.
00:17:29.000 | Strategy number two, to make it last longer, you get a tune-up, change your oil,
00:17:33.000 | and make sure your tires are pumped to the right pressure.
00:17:35.000 | Even when the cost of the service is factored in, your improved mileage saves you 15% on gas for the year.
00:17:42.000 | Strategy number three, use it less, you reduce your transportation cost a third by carpooling,
00:17:48.000 | combining more errands, and walking more.
00:17:51.000 | If you bring those three strategies together –
00:17:54.000 | for strategy one, to pump your gas and get it cheaper, dropped it from $75 to $67.50 per month.
00:18:03.000 | Two, getting the tune-up, dropped it down to $63.75 per month,
00:18:08.000 | even after you factor in the cost of the tune-up amortized over the year.
00:18:11.000 | Strategy three, by reducing your transportation by a third, cuts your cost to $50 a month.
00:18:18.000 | If you put all three of those together, you can drop your monthly gas cost to $38.25.
00:18:26.000 | And her final example involves a haircut.
00:18:29.000 | You get your haircut every six weeks for $25, including tip, for an annual cost of $216.67.
00:18:38.000 | Strategy number one, buy it cheaper.
00:18:40.000 | You shop around and find a less prestigious salon that does as good a job for $12.50,
00:18:46.000 | dropping your cost to $108 per year.
00:18:49.000 | Strategy number two, to make it last longer.
00:18:52.000 | Well, no savings here.
00:18:54.000 | She says she hasn't figured out how to make her hair grow slower yet.
00:18:58.000 | Strategy number three, to use it less, you trim your hair around the ears by yourself
00:19:05.000 | so that you need to get a professional cut once every eight weeks instead of once every six weeks.
00:19:11.000 | That, of course, would save you money and drop your annual expenses from $216 to $162 per year.
00:19:18.000 | But if you put both of those applicable strategies together, strategy one and three,
00:19:23.000 | it drops your annual haircutting costs to $81.25.
00:19:30.000 | Those are Amy's examples, and I think they're really good examples, and I love her math.
00:19:39.000 | What are yours?
00:19:43.000 | The way that you tackle this is look at your transactions,
00:19:47.000 | and it can be your transactions from yesterday, from last week, last month.
00:19:52.000 | If you've got the data due last month, due the last quarter, due the last year.
00:19:56.000 | But pick an area of your budget and start to think.
00:20:02.000 | Is there a way that I can take this area and buy something cheaper?
00:20:10.000 | Can I make it last longer?
00:20:12.000 | Can I use it less?
00:20:15.000 | And these three things can be applied at every level,
00:20:19.000 | but you'll have to do the research to figure out how to do it.
00:20:23.000 | One of the secrets to saving money is you've got to be prepared in advance.
00:20:27.000 | If you're going to get something in the used market, you're going to have to be more patient
00:20:33.000 | than those who just want to go out and buy something new and fresh.
00:20:37.000 | The major benefit to buying new is selection.
00:20:40.000 | You can pull up your Amazon account and plunk in just about whatever you want
00:20:45.000 | and have it at your door a couple days later, and that works great when you need something right away.
00:20:52.000 | But that doesn't necessarily work really well by saving money.
00:20:56.000 | My wife and I, our blender is starting to fail.
00:21:01.000 | Every time we go to blend up, we make these great waffle recipes that they don't have any flour in them.
00:21:08.000 | You just buy--actually, I'll give you the recipe.
00:21:10.000 | Here's a little bonus waffle recipe from Joshua.
00:21:14.000 | Hit pause if you're interested in a gluten-free, very healthy waffle or pancake mix, and grab a pencil.
00:21:20.000 | Go to your local nutritional bulk food store.
00:21:24.000 | Whatever store you have locally where you can buy seeds, nuts, grains, things like that.
00:21:29.000 | For us, it's just a local nutrition store.
00:21:32.000 | You're going to buy buckwheat, golden flax, millet, quinoa, amaranth, and sesame seeds.
00:21:39.000 | The recipe is very simple.
00:21:41.000 | You do three parts of buckwheat and golden flax, two parts of millet and quinoa,
00:21:48.000 | and one part of amaranth and sesame seeds.
00:21:53.000 | Three cups of buckwheat, three cups of golden flax, two cups of millet, two cups of quinoa,
00:21:57.000 | one cup of amaranth, and one cup of sesame seeds.
00:22:00.000 | Mix that together into a dry mix and set it aside.
00:22:03.000 | Then when you want to make waffles the next day, then put the amount that we use,
00:22:08.000 | put about two and a half cups of the mixed seeds or grains into your blender.
00:22:13.000 | Put three cups of water on top and let it soak overnight.
00:22:17.000 | That way, overnight, the seeds absorb the water.
00:22:20.000 | It doesn't actually sprout them, but it softens them and turns them into a very easy batter.
00:22:26.000 | In the morning, add three eggs, six tablespoons of oil.
00:22:30.000 | If you're making waffles, you need the oil.
00:22:32.000 | If you're making pancakes, you can skip most or all of that oil.
00:22:35.000 | A teaspoon of salt and a tablespoon and a half of baking powder.
00:22:39.000 | Two and a half cups of the mixture, three cups of water, three eggs, six tablespoons of oil.
00:22:43.000 | If you're making waffles, no oil.
00:22:45.000 | If you're making pancakes, one teaspoon of salt and a tablespoon of baking powder.
00:22:49.000 | Then just blend that up and make your waffles.
00:22:51.000 | It makes a really great waffle, gluten-free, and it's healthy.
00:22:56.000 | It just has exactly what you heard in it, and they are delicious.
00:23:00.000 | So the point is that when I make those waffles, it's destroying our blender.
00:23:05.000 | We have this cheap blender.
00:23:06.000 | I can't remember if we bought it or if we found it for free somewhere, and the motor is burning up.
00:23:10.000 | So we're keeping our eyes open for a blender.
00:23:12.000 | Now, of course, you could just trot down and get a new one, but where's the fun in that?
00:23:15.000 | You've got to keep your eyes open, and you've got to be thinking in advance,
00:23:18.000 | "I'm going to need a blender a couple months from now when the thing finally gives out."
00:23:24.000 | And that's the price you pay for getting things in the used marketplace.
00:23:28.000 | But if you start to think ahead, you can save huge amounts of money on these types of expenditures.
00:23:36.000 | Almost every expense that you have in your life will have some kind of insider secret
00:23:44.000 | that if you learn and you study, you can know and apply for the rest of your life.
00:23:54.000 | Last week on my Twitter feed, I shared a great promotion that Costco was doing on tires.
00:24:00.000 | From my experience, I think Costco is one of the best places to get tires, but you have to wait.
00:24:04.000 | Every couple of months, Bridgestone and Michelin go back and forth with their rebates,
00:24:08.000 | and you've got to wait for Costco to--you've got to wait for them to offer the manufacturer's rebate.
00:24:13.000 | That saves you about $60 or $70 usually on the cost of your tires.
00:24:17.000 | The actual cost of the tires is relatively low, and then Costco usually has this standard installation fee
00:24:24.000 | of $15 per tire, which comes out to $60 if you're replacing four.
00:24:28.000 | So it's a $60 installation fee, and that comes with road hazard, all the lifetime balance and rotation,
00:24:35.000 | road hazard repair, et cetera.
00:24:37.000 | It's the best deal that I know of that you can just go and get any time you like on tires.
00:24:42.000 | So last week--and I think it's still going on if you need tires.
00:24:45.000 | I think it goes until the second week of January.
00:24:47.000 | Last week, Costco was offering this promotion where you had the manufacturer's rebate.
00:24:52.000 | Michelin and Bridgestone were both offering manufacturer's rebates, and they were waiving the installation fee.
00:24:59.000 | They dropped it to $0.01 cost of installation fee.
00:25:01.000 | So that's $110 savings on tires.
00:25:04.000 | If you need tires, that's a good way to buy them cheaper.
00:25:07.000 | You're getting a really high-quality brand, and you're buying them cheaper when you wait for that rebate at the local warehouse club.
00:25:13.000 | How do you make your tires last longer?
00:25:15.000 | I learned this one the hard way.
00:25:17.000 | You rotate them.
00:25:18.000 | I had a pair of tires I bought a number of years ago.
00:25:20.000 | They were warrantied for something like 70,000 miles, and they didn't last me more than 35,000 miles
00:25:26.000 | because I didn't understand the impact of rotation on tire life, and my warranty was void because I didn't rotate them.
00:25:33.000 | Now, my little trick, I make sure that I rotate exactly on schedule, and I do that two ways.
00:25:40.000 | By making it convenient, doing it at the Costco where I go down and shop, easy to drop the car off, have them rotated while I go through the store.
00:25:47.000 | And secondly, I make a little reminder that's on my windscreen.
00:25:51.000 | I use my label maker, and I print out a little label that says "Rotate tires at X number of miles."
00:25:58.000 | And so just like your oil change sticker, my tire rotation sticker is right there reminding me to do that maintenance
00:26:04.000 | because I do that maintenance on -- that's the kind of maintenance that's done on a use basis.
00:26:08.000 | A lot of my car maintenance I do on a calendar basis.
00:26:11.000 | Change my oil once a year.
00:26:13.000 | I use high-life oil.
00:26:15.000 | I use the AMSOIL high-life oil that's rated for a year instead of on mileage and higher-quality filters as well.
00:26:24.000 | That makes it easy.
00:26:25.000 | So every January, I just change my oil January 1.
00:26:27.000 | And then other -- but maintenance items that are mileage-based, you need a reminder so that you get them done.
00:26:33.000 | So that's how you make the tires last longer.
00:26:35.000 | Then, of course, use it less.
00:26:36.000 | Well, use the car less.
00:26:38.000 | That's going to save you money all around.
00:26:40.000 | Those are just -- I'm trying to give you some very practical tips.
00:26:44.000 | You're getting a little bit of philosophy, so waffle mix recipe and some tires.
00:26:47.000 | That's called radical personal finance.
00:26:49.000 | But you can apply this in your own life and start to study the areas that you need to save money on.
00:26:56.000 | Just ask yourself those three questions.
00:26:58.000 | Number one, how can I buy this cheaper?
00:27:02.000 | Number two, how can I make it last longer?
00:27:05.000 | Number three, how can I use it less?
00:27:09.000 | If you'll do that on the things that you buy, you'll be able to save money because if you do all three of them,
00:27:16.000 | your use cost of the items that you buy will drop substantially.
00:27:24.000 | Now, recognize that you need to think about all three of these.
00:27:27.000 | There are times when you don't want to buy something cheaper because it is just going to fall apart faster.
00:27:35.000 | I have shoes that I have worn for 10 years and they're still perfectly good shoes, some of them more.
00:27:39.000 | So sometimes it's worth it to pay double the cost of the cheap thing that's going to wear out in a year and a half
00:27:44.000 | and get the more expensive thing that's going to last you for 10 or 15 years.
00:27:47.000 | So consider all of that as well.
00:27:49.000 | Fundamentally guide yourself through the process of how can I buy it cheaper, how can I make it last longer,
00:27:54.000 | and how can I use it less.
00:27:56.000 | Do that on your transactions going forward.
00:27:58.000 | Be organized with knowing what you're going to need so you can keep your eye out for a deal,
00:28:02.000 | to get a great quality product at a cheaper price.
00:28:05.000 | When can you find something on sale?
00:28:07.000 | When can you get a rebate?
00:28:08.000 | When can you get a coupon?
00:28:09.000 | Do that consistently now.
00:28:13.000 | And if you're just getting started, do that consistently now when it saves you $1 or $2.
00:28:18.000 | And the day will come when you have so much money that you can do it consistently on your $100,000 and your $1,000,000 transactions.
00:28:26.000 | Frugality and thrift are not optional wealth building tools.
00:28:32.000 | You cannot build and maintain wealth unless you're dedicated to appropriate frugality.
00:28:41.000 | Let's get the year started right.
00:28:43.000 | Track your expenses.
00:28:44.000 | One basic habit that will change everything for you is tracking your expenses.
00:28:48.000 | Do that.
00:28:49.000 | Use YNAB.
00:28:50.000 | I'm going to do a quick ad.
00:28:51.000 | RadicalPersonalFinance.com/YNAB.
00:28:53.000 | That's the budget tracking software that I use every day.
00:28:55.000 | I have it open on my computer screen right here looking at last year's expenses.
00:28:59.000 | So download a free -- what is that?
00:29:01.000 | 31, 33, 35-day trial at RadicalPersonalFinance.com/YNAB and get started now.
00:29:07.000 | It's January.
00:29:08.000 | It's time to make progress toward your wealth goals this year.
00:29:20.000 | This show is part of the Radical Life Media network of podcasts and resources.
00:29:26.000 | Find out more at RadicalLifeMedia.com.
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