Always ask for a discount – Just ask “Can you do any better than that?” or “Is that the best you can do?” This simple question could potentially save you a lot of money.
Be prepared for the unexpected. You never know when the heater might break or the car transmission might go out. An emergency fund with 3-6 months of your living expenses ought to be adequate.
Curb (or cancel) credit card spending. Since people spend more money with credit cards, you need to decide if you are in a position to be able to afford the convenience charge.
Determine to become debt-free. Take practical steps to reduce your debt load. Make sure you know the reason why you went into debt in the first place.
Eat at home. Restaurants can be expensive. If you don’t have room in your budget, you can save a bunch of money by making your own meals.
Financial focus. Don’t try to do too many things at once. Focus on becoming debt free, saving an emergency fund, or saving for retirement, but don’t do all at once.
Get going. The best time to start investing is today. With compound interest on your side, the sooner you invest the better.
Home ownership is only a blessing when your payments are a reasonable part of your income. Try to limit all your house related expenses (mortgage, utilities, maintenance) to 25-30% of your income.
Ignorance today does not necessitate ignorance tomorrow. Perhaps you know little about mutual funds. That’s alright, but make an effort to learn about them so that you can maximize your financial resources.
Jobs are essential for financial success. Do your best at every project and strive to exceed expectations.
Kill your bad habits. People make bad money choices for different reasons. Discover and kill those habits. People go into debt for different reasons. Identify your debt motives and drive a stake in them.
Leave your investments alone. Don’t try to time the market – it is extremely hard. Invest the same amount on a regular basis – regardless of what the market is doing.
Money can give satisfaction, but it cannot buy happiness. Know and respect the limitations of money.
Never do something with your money if you don’t understand it (Dave Ramsey). Scams and fraudulent activities result from people doing what someone in the know said. Even if someone, or an organization is Christian, proceed with caution.
Offer a service. If you want to make a few extra dollars by turning a hobby into an extra income, you need to be sure your idea serves people. If your product serves people and is reasonably priced, it will be successful.
Pay yourself first. When you get a paycheck set some aside for taxes, some for giving, and some for your future. If you are last on the payment list, you will never get paid.
Quit trying to impress others. Do what you can afford and let everyone else try to keep up with the Joneses.
Remember that relationships are more important than money.
Surf the web for some great resources. Some of my favorite (among many) PF blogs include Christianpf, Frugal Dad, Free Money Finance, and Get Rich Slowly.
Tithe. Remember that you are a steward of the resources God entrusted to you. Take a portion of your income (proportionate to your income) and use it in service to the kingdom of God.
Understand who influences you financially. What makes you spend? What did your parents teach you about money. An unknown enemy is harder to defeat than a known one.
Value your items. When shopping, always ask if something is worth its value. Seek also to find out if you can get the same value for a lower price.
Will. A will is a loving act, so be sure you have a completed will. Be sure you also have life insurance.
eXamine your investments once a year to be sure they represent your goals, values, and risks.
Yearly financial review. Are you on track to meet your retirement goals? Are there any financial adjustments that need to be made? How are your investments performing?
Zealous. Your financial results depend on your intensity level as much as they depend on your financial knowledge. As you learn new financial lessons, apply them to your life with zeal.
Photo by Pink Sherbet Photography.
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Hey Craig,
Admittedly, I am late to the party on your first point (I unsubscribed to the blog to simplify my reading for a few months and missed Bob’s post about asking for a discount.) However, I decided that I’d bring it back up on the latest post rather than going back to the one from a few months ago.
Coming from the small-business-owner category (my family owns two and I managed one of them) I don’t agree that it is a good idea to ask for a discount, even though we’ll probably give you one.
It is possible that a certain store is simply ripping you off, but most likely they are priced right where they should be according to whatever price model their industry follows. In fact, currently, many of them are BELOW what is called for by the industry because people won’t even talk if they think the price is too high.
Which means, especially now, many industries are close to the break even point on their retail pricing. For instance, if I were to give you a 10% discount on something in our store it would put us below the break even point on that item. Which means the most I could do is pay the tax for you and give you your 7% discount. But that means that I have literally made no money on the sale. Sure it moved merchandise and it helped pay the store bills, but the money as a small business owner would not be real profit. My paycheck, in effect, would be zero on that sale.
So, in a down economy, although it may seem the smart thing to do, it is very hard on the small businesses to do this repeatedly with every customer. If you’re hard set on getting a discount, wait for them to put on a sale. With a sale we get more traffic than usual, which means more sales than usual, which means our break even point is lower. That means that we can give you a discount on something that isn’t on sale because of the increase in traffic.
So, if you really really want to ask for one (and I beg you not to) at least wait for a time when the business can handle it. Most of us are knuckle to the bone right now and giving those discounts means that we don’t get paid.
That’s my two cents.
Thanks for the posts.
-joe
All excellent points. Investing early and often, and focusing on financial goals, in particular, are important to me.
I think focus, ignorance, and killing your bad habits are three of the ones that most often go overlooked when people are trying to get their finances in order. Having a solid foundation for achieving financial success requires not only knowing what to do and how to do it, but why to do it.
Succeeding in life requires having the right mindset, which includes being focusing on your financial and life goals, recognizing that you’ll never know everything and using that to fuel further learning, and adopting a mindset that allows you to control your path in life instead of feeling sorry for yourself as life “happens” to you.
I think these are just as important as learning how to save, how to stay out of debt, and how to invest. Great post.
I have found that if people or companies are unwilling to give a discount they will just say, “yes. That is the best we can do”. In a recently blog post I shared that I am having a 20% success rate with the question (80% of the time I don’t actually get a discount).
The three times the company did drop the price I think it was to both our advantage.
Case #1 – a company really wanted my business, but they did not have a guarantee. I explained that their competitor offered a 6 month guarantee. They matched the guarantee. If they did not they would have lost my business.
Case #2 – a law firm increased their rates 65% since the last time I used them. We had a group of 16 people needing some paperwork processing, but they were still charging the same rate as they did for individuals (even thought it was only one trip to drop off and pick up all the paperwork). They dropped 10%.
Case #3 – an airline changed their schedule on a flight for my dad causing him some extra rebooking expenses. He asked if they could help him out and they upgraded him.
Looking at each of those cases it seems as though there was a legitimate reason to ask for a discount. In two of the three cases the discount was not a reduction of price but an increased service.
As a small business owner I’m sure you would rather someone explain that “x” down the road is offering something better. Otherwise they might just walk over to the next street and buy the product there.
My point? There are cases where asking for a discount is mutually beneficial. Nevertheless, I see what you are saying and I’m thankful to have your perspective on the subject. Might we suggest people ask for a discount when it seems appropriate?
Thanks for resonding, Craig. I do appreciate your advice (and the whole site) a lot. Lot’s of good information to help us honor God with our money.
I could maybe concede that “when it seems appropriate” you can ask, but still remember that the small guy is in the toughest spot. He pays more wholesale than the big guys, his inventory is much smaller, and his mark-up is less than it was 10 years ago. It’s also tough on us mentally because usually it comes off as a condescending “these prices are ridiculous, I’d never spend this much on a sofa” rather than “have you got something you can do a little better on.”
I know one way that you’ll likely not get a discount no matter how you ask it to consistently complain about a store’s high prices straight to the salesman. The longer you do it the worse off you’ll be. It tells us that even if we do reduce the price that you’ll likely not be satisfied with the product…and you’ll come back to complain within months. So, if you come in complaining expect to walk out with a full sticker.
Me personally? I give discounts to folks who buy more than one thing and don’t bicker on the price. If you’ve got your checkbook out and just bought a sofa and a recliner, I’ll probably through in some lamps or knock some money off the top.
Thanks again,
-joe
Very useful information posted in hole blog.