greg – Page 5 – #MoneyGoals

Lessons Learned from Australia

Australia isn’t a radically different place from the US, but there were some notable differences and similarities I observed while spending two weeks there.

Public Transportation

Brisbane and the surrounding area easily had the best public transportation system I’ve ever seen. There was an endless stream of buses going in and out of the city, with an easy to use payment system, and relatively low fares. They have a separate “busway” next to the highway, a road only buses can drive on. So even if cars are stuck in traffic, the buses are still able to drive people around at normal speeds.

I was able to explore for 12 days straight and all of my public transportation costs combined came out to be $40 AUD (about 30 US dollars). One day, Mars and I took a train from Brisbane to Gold Coast which takes about an hour by car, and it was about $1.50 one way per person. That’s crazy.

Power Outlets

Every power outlet that I encountered in my time down under had a switch on it. This switch allows you to turn the flow of electricity to that outlet off whenever you aren’t using it, saving energy (therefore money) and making the outlets safer as well. When I told an Aussie that ours were on all the time, she asked “How expensive are your electricity bills?!”

Gas Prices

Gas is expensive in Australia compared to the US. Twice as expensive. While there, my friend filled up her car with 27.65 liters (about 7 gallons) of gas that cost $35.09 AUD (about 26 US dollars). Some quick math, and that comes out to a little over 4 US dollars a gallon, meanwhile the gas station by my house in Dallas sells the stuff for $2.20.

The majority of the difference in costs comes from a fuel tax in Australia. Their fuel tax when converted comes out to over $1 US dollar per gallon of gas in added price. This tax revenue is partially used to fix their roads, but a few articles I read argued that not enough of the tax revenue was being invested in infrastructure.

Vehicles

One would think that with the high gas prices, people would only buy small, fuel-efficient cars. While there were many compact cars, there were quite a few ridiculously large, jacked up vehicles as well. The black tube on the side of the truck on the right is a snorkel, which allows you to drive through water without flooding your engine. These trucks are a great way to explore the Australian bush, but a silly and inefficient way to drive on the highway (which is where I saw most of these contraptions).

While every country has their good and bad aspects, it’s always interesting to explore somewhere new and compare and contrast with your home country. Have you found something different abroad that you wished we had in the US?

Australia and Balance

A few days ago I got home from Australia, ending a two week period in which I spent as much money as I usually do in two months. I’d be lying if I didn’t admit spending that much hurt a bit.

I’d also be lying if I didn’t admit that it was an incredible experience. The people I met, places I visited, and memories I made will stick with me for the rest of my life.

Now, I was able to afford this trip because I don’t have any debt and I have a sizable financial safety net set up for myself. If you have debt, or don’t have enough savings to cover at least the next 6 months of your life, I would suggest that you work on those before spending hundreds of dollars on traveling. In fact, I would also suggest maxing out your Roth IRA for the year as well (which I did).

But life is all about balance. No one is happy spending 100% of their money, but I don’t think anyone is happy saving 100% of their money either. We all have to find what balance works for us. In the past, I’ve declined experiences with family, friends, or traveling to save money, and my trip to Australia was an interesting look at how the opposite mindset made me feel (declining saving to travel/spend time with friends).

I am still figuring out what the right balance is for myself, but I think it’s healthy to experiment to find what works for you. If you usually spend a lot of money, try cutting back and see if it’s a better balance. If you save all your money, try spending a little bit and see if it’s a better balance.

As the great philosopher Smash Mouth once said, “We could all use a little change.” This next month, I encourage you to try changing something or doing something new to find balance in your life. #MoneyGoals

(Pictured: Sunset in Byron Bay, NSW, Australia. May 21, 2017)

Why I Don’t Use a Budget

The vocabulary word of the day is gamification. For my fellow millennial friends, I’m talking about Snapchat streaks. For anybody who doesn’t know what Snapchat streaks are, gamification is the use of game characteristics (point scoring, competition, etc) to incentivize an action.

The power of gamification is unquestionable. If you have sent someone a Snapchat every day for the last 147 days, despite not having anything to tell them you’re going to send another one to bump your number up to 148 the next day, guaranteed. Even though that number doesn’t actually mean anything.

The good news is that you can harness the power of gamification to improve your life. Many people have already done this, competing with friends to take the most steps in a day.

I personally use spending gamification instead of a budget. I understand that budgets are useful tools, but I also think they lock you in to a specific spending level, and there’s no incentive to improve further.

I track all of my spending each month, and each month I try to spend a little bit less than I did the month before. I spent $40 eating out last month? Let’s see if I can spend less than $30 on eating out this month! This reinforces my spending goals with an exciting challenge, instead of the boring, “How much is in my budget?”

This gamification technique also requires less work than a budget. All you have to do is keep track of what you’re spending, and usually your bank or credit card company does that for you!

So I challenge you to give it a try. Bonus points if you compete with a friend, and see who can spend the least amount on eating out/gas/groceries/clothes/alcohol for the next month. Good luck, and enjoy the game! #MoneyGoals

(Pictured: A young Greg lost in Great Sand Dunes National Park and Reserve, Colorado. Summer 2011)

Privilege

The world is not fair. So much in our lives hinges on two things, where we were born and who gave birth to us. In both cases we have no say in the matter. The hand you’re dealt is the hand with which you must play the game.

I understand that I was dealt about as good of a hand as anyone could hope for. I was born in a first world country to a middle class family as a white male in a system that unfairly favors white males. My parents read to me as a child, were patient and loving, and taught me how to excel at school and at work. The list could go on, but you get the point.

Others are dealt more challenging hands in the game of life. You might be born into a much less privileged situation than I was. I can imagine it is easy to disregard my thoughts and advice from that perspective, “Yeah, he can save money and invest it because he was born into a privileged life!”

I agree. I acknowledge that I will never fully understand anyone else’s perspective but my own, and my privilege may keep me from seeing things as others do. That being said, I believe that everyone’s unique perspective is valuable, and we all have things we can learn from each other. In the last few years I have had the opportunity to learn a great deal from hearing about different perspectives and life experiences.

And I want you to learn from mine!

I want the secret equation to become wealthy to be common knowledge. I want it to be a tool that everyone uses, not just those from privileged backgrounds. I want everyone to know the benefits of consuming less. I want everyone to know how to use a Roth IRA to achieve a comfortable retirement. I want everyone to have access to information that they can use to improve their lives if they so choose.

No matter who you are, I believe the ideas I discuss here are applicable to you. Everyone can benefit from simplifying their life or taking a closer look at how they’re spending their time and money. There is not a single human on this planet who is perfect, therefore we all can improve. Since people are still drinking toxic sludge, still buying $3,000 chairs with money they don’t have, and still spending billions on storage units for junk they don’t use, I’d say we have a lot of improvements left to make. #MoneyGoals

(Pictured: Hope Outdoor Gallery. Austin, Texas. March, 2015)

You Deserve Nothing

“You deserve way better than someone who treats you like that!” a supportive best friend says after a rough breakup. Respectfully, I disagree.

We are not deserving of anything. When you come into the world, the world owes you nothing. You are not entitled to a car, a roof over your head, or a job once you graduate. You aren’t entitled to a relationship with someone who treats you the same way you would treat your celebrity crush.

Instead, we earn what we want in life through our actions, and through hard work.

I learned this lesson in my teenage years, when my mom refused to buy me a phone. “All of my friends have one, and I have straight A’s, and I deserve it!” I firmly believed that due to my existence, and doing things I was expected to do anyways, that I was entitled to an iPhone.

“Get a job,” my mom would respond. Although this made me unhappy at the time, I know now that my mom was setting me up for a life of satisfaction.

I learned that if something in life isn’t the way you want it, you are responsible for changing it. Want a phone? Get a job. Think you should get a raise? Work harder, smarter, solve a problem at work, go the extra mile. Want great relationships? Work on yourself, improve your communication, become more patient, understanding, and caring.

Want a better life? Do what you need to do to get there. It’s not anyone’s responsibility but your own. #MoneyGoals

(Pictured: A pile of dirt that I used to fill in holes in my parents’ lawn. Mora, MN. August, 2016)

Four Things You Need to Buy to Be Happy

1. A big house.

Everyone knows that the bigger your house the more happy you’ll be. What easier way to let those around you know that you are a successful and cool person? Whenever anyone comes over to visit, they will ooh and ahh at your expansive living room, multiple guest rooms, and the kids will love the pool out back. Simply take out a 30-year mortgage, and don’t mind adding an extra hour to your commute. It will definitely be worth it once you have that three car garage.

2. The most fashionable clothes.

First impressions are important. Unless you are draped in the newest, trendiest fashion, other people will think you are a failure. One little known fact is that humans are attracted to other humans with expensive clothes, even if they’re jerks. So essentially buying the best clothes will automatically make people love you, while also allowing you to treat other people terribly.

3. A luxury car (or cars if you want to be extra happy).

Ok, you bought your huge house in the suburbs. Now since your commute is longer, you’re going to want a comfortable car to drive in. Consider a new Ford F-150! This vehicle will make you feel like you’re sitting in a La-Z-Boy, you won’t feel a single bump in the road. You will also never have to use your creativity in order to move things, just throw it in the bed of your luxury truck! As a bonus, it gets city MPG in the high teens!

If a truck isn’t your style, maybe you want to opt for a Mercedes Benz coupe. You deserve a 241 horsepower engine to move your less-than-200-pound body around. Think about it, it’s kind of like being a king in the old days whose carriage is pulled by 241 horses! This excessive power will signal to those around you that you are modern royalty. There was actually a scientific study done that reported that horsepower directly correlates with happiness. If you need to take out a loan, don’t hesitate. You can’t compromise when it comes to your vehicle.

Or why not both? And if you have enough available credit, maybe get a third vehicle? Why have a three car garage if you’re not going to have three cars?!

4. Restaurant meals.

Happiness comes from not doing work. This is why we love to go out to eat, so someone does the work for us. Having your food prepared and hand delivered to you, and then not having to do the dishes activates the part of our brain that tells us that we are super cool. I personally spend a lot of my time cooking, and it is a large source of unhappiness for me. Whenever I make food for my friends and family, they tell me how useless of a skill it is, and that I should have taken them to a restaurant. Restaurants are also known for serving the most healthy food, so you will know that you’re getting the most value for your money.

So next time you see someone who seems to be happy, just know that they probably have a gigantic house, multiple luxury cars, a walk-in closet full of brand new clothes, and they have not touched a dish towel in years.

Oh, and April Fools. #MoneyGoals

Minimalism

One peculiar aspect of being in college is that I essentially have two homes. While I spend the vast majority of every year living at school in Dallas, I always have my room at my parents’ house in Minnesota to go back to every winter break.

Fulfilling the American stereotype, I have plenty of stuff in each home. A dresser and a closet full of clothes both here and there. Two beds. Two book collections. Multiple guitars at each location.

While this two-room setup is convenient, it’s also ridiculously inefficient. There is no reason for me to own a room full of material possessions that sit and do nothing for 11 out of 12 months. Especially considering that there are people in Minnesota, and probably in my own community who would benefit greatly from owning my spare clothes/bed/blankets, etc.

It also occurred to me that I did not miss a single thing in my old room at my parents’ house. My life was great without those items, and if I had come back and my room had been empty, I couldn’t have named any of the things that were in it.

This made me take a step back and look at the things that I owned, both at school and at my parents’ house. What did I actually use? What added value to my life? Even in my closet at school, I had worn maybe half of the clothes in the past year. Why did I own things I didn’t use?

So I started learning about minimalism. I stumbled upon two guys called The Minimalists, and started listening to their podcast. Their message made a lot of sense to me. They outline many ways that owning and consuming less can add value to your life, but here are the biggest ones that I have experienced:

No. 1: Money. You can save a ton of money by living a minimalist lifestyle. Living in a smaller apartment or house, driving a smaller car or no car at all, not buying that 12th pair of shoes. Being more conscious of what you consume can lead to lots of extra cash. You can use that cash to purchase more of your life, since money is time, or purchase experiences (which have been proven to make you happier than material things).

No. 2: Flexibility. Since I don’t own very many things, it will be easier for me to move from place to place. Being in college, I will most likely do a lot of moving over the next few years. I want to live and work all over the country and the world, which is easier with less stuff. I also love traveling, and it’s much easier (and cheaper) to travel with less stuff.

No. 3: Health. A year ago I started eating a plant-based diet, and have never felt healthier or looked better. Eating plants instead of meat considerably reduces the amount of the earth’s resources you need to feed yourself, as well as reduces your risk for lots of not-so-fun stuff like cancer and heart disease. If you are not ready to go vegetarian just yet, simply reducing the amount of red meat you consume can make a difference. (It’s also less expensive to eat a plant-based diet, blog post on that coming soon!)

No. 4: Stress. We only have so much mental power to make decisions in a day. Opening your closet and being confronted with picking which of your 80 shirts you are going to wear is stressful. I have a few go-to outfits, and cycle through those for work. It also takes less time, and lets me sleep in more 🙂

No. 5: Happiness. When you’re not looking forward to that new shiny thing, it makes you stop and appreciate what you do have. Being able to look at a fancy car and think “My life is great without that” is much more satisfying than thinking “I need that, but I can’t buy it. Life sucks.” I also find a lot of joy in donating my things, knowing that it might help someone out. That makes me a lot happier than anything would just sitting in my closet not being used.

And really, that’s all anyone wants, is to be happy. Stuff does not make people happy. So being able to pay less attention to stuff will allow you to pay more attention to what does make you happy. #MoneyGoals

If any of this sounds interesting to you, I would highly recommend checking out The Minimalists’ documentary on Netflix. Here’s the trailer:

Money is Time

“Time is money.” We’ve all heard this phrase, and as a cliché it’s all but lost its meaning. But it’s true!

Just think, how did most of the money that you have ever had in your life get to you? Yes, you probably received some gifts, maybe a scholarship, or an inheritance even. But the vast majority of the money that comes to you is probably coming from your job. No matter who you are or what kind of job you have, a job is simply a tool that converts your time into a good or service, that you are then given money for. Therefore, money is just a measure of the amount of time you have put in.

Say I make $10 per hour, and I want to buy a new bike that costs $300. That bike costs 30 hours of my time. Easy enough right?

I was thinking about this concept while standing on a sidewalk in downtown Dallas yesterday at 5 pm, waiting for the bus to take me home. I watched an unusual amount of new fancy cars thunder past me. Mercedes, Range Rovers, Jaguars, and a Maserati. Each contained exactly one person, a business man or woman speeding home.

Let’s say for easy math, a new Range Rover costs $100,000 (actual price is pretty close, not bad!) and our luxurious businessperson makes $150,000 per year, or $75 per hour (which would almost put them in the top 5% of earners in the US).

This means that their Range Rover costs 1,333 hours of their time just to purchase, not counting gas, maintenance, or insurance.

1,333 hours.

I wonder if the people who buy these cars would make the same decision if the purchase was presented to them in hours instead of dollars and cents. “Ma’am, this vehicle is the top of the line in luxury products, and you only have to spend 1,333 hours away from your friends, family, and hobbies” No thanks!

What’s more concerning is people who don’t make that much per hour, and then buy a fancy car with a loan. If you’re making $15 an hour and take on debt to buy a $30,000 car, then you’re signing away a future 2,000 hours of your time (most likely more due to interest). You are now chained to that car payment, it owns you.

The next time you make a major purchase, think about the time that it costs, not the amount of money. Is the time that you could spend doing *insert thing you love doing* worth giving up for *insert purchase*?

And if you decide to save the money, be sure to invest it and make that retirement account grow! #MoneyGoals

Why Health > Wealth

Last year, I got to meet and take a picture with one of the richest men in the world. His name is Steve Schwarzman, and he is the CEO and founder of Blackstone Group. According to Forbes, he is worth 11.5 billion dollars. Here’s a picture of us hanging out in our pajamas.

Mr. Schwarzman is wildly successful in the business world, and has more money than I could ever dream of having, yet I do not envy him. He doesn’t appear to be the most healthy dude in the world, sporting a solid gut and moving around pretty slowly. I would have been surprised if someone told me he had exercised once in the last five years. When I met him, I thought that he must have been something like 80 years old. Turns out he was 69 at the time.

Contrast Mr. Schwarzman with my Grandma, who just turned 80. She goes on regular walks around her neighborhood, and has logged over 3,300 workouts at her local gym over the past 11 years.

Grandma is not a billionaire, and not a millionaire. But she’s got enough money to live comfortably. Most importantly, she is healthy and happy. She is a spunky 80-year-old who will zip around her house in excitement whenever she has people over for dinner, and she doesn’t hesitate to dance with her great-grandchildren.

While I do focus on money quite a bit, I strive to be more like my Grandma and less like Mr. Schwarzman. I want to still be riding my bike and eating healthy well into my old age. I want to hike up mountains when I’m 80 years old, still be able to dance when I’m 100. With a lifetime of good habits and advancements in medical technology, there’s no reason I shouldn’t live to be 120 (can you imagine the compounded returns?).

At the end of the day (and at the end of your life), the numbers in your bank account won’t mean anything. Your ability to still move around and enjoy life will definitely be more valuable. The extra years or decades added on to your lifespan that you get to spend with family and friends will outweigh any amount of money, and that’s why health is more important than wealth. #MoneyGoals

#MoneyGoals Ways to Save No. 1: Drink Water

Nearly half of Americans drink a soda (or pop for my Minnesota friends) daily. That blows my mind. As a country, we collectively spend $65 billion every year on artificially-colored sugar water. For the privilege of consuming a substance that rots our teeth, dehydrates us, and increases risk of obesity, diabetes, liver disease, we spend $850 per household annually.

Again, even if we completely ignore the health consequences, it still doesn’t make sense to waste $850 every year on something that unnecessary. Say that household invests that $850 per year for 18 years, building up a college fund for a kid. It would end up being $30,922.12, also known as a large chunk of college expenses.

Contrast this with the extra-low discount price of tap water at $0.004 per gallon, which is about as close to free as it gets, and you can see why it doesn’t make any sense to buy your drinks. This includes bottled water, which can be 300-2000x more expensive than tap water, not to mention creates needless plastic waste.

As a logical person, I have never understood why anyone would pay more for something that was less healthy. Drink water, save money, feel better, look better. #MoneyGoals

(Pictured: Some friends and I enjoying some free water. Austin, Texas July 2016)