Use the “briefcase technique”

Photo by mostafa mahmoudi on Unsplash

One thing I’ve always hated about job interviews is when they ask what my salary expectations are.

What do you say to that? Your primary goal in the interview is to get the job in the first place. Once you start talking salary, it’s like fighting a war on two fronts. Will you say something way too high and be dropped from consideration? Will you shoot to low and win the battle while losing the war?

I think the best strategy might be this: price high, then justify.

Of course, Ramit Sethi has an even better strategy. It’s the exact…

Quick wins the simple way

People vector created by pch.vector —

When it comes to saving money, there’s two areas that I recommend focusing on: Quick Wins, and Big wins.

  • Quick Wins might not save an enormous amount, but they are relatively easy
  • Big Wins save a ton, but are harder to pull off

If your frugality efforts don’t save a ton, they better be easy. If they’re not easy they better save a ton.

Here’s my patented four-fold frugality framework from which this principle is derived:

Money = Life energy

Your Money or Your Life is part of my personal finance origin story. It was one of the books my mom gave me when I was going off to college but told her I wanted to learn about money.

That was the original 1992 edition. Here’s a picture of my copy, which I still have (as well as my updated kindle edition):

Image source: author’s image

A lot has changed in the world since this classic was first published. One of the co-authors (Joe Dominguez) may have passed away, but the other (Vicki Robin) took it upon herself to update the book in 2018.

The tyranny of compounding costs

Image Credit: Author’s Image

When it comes to most purchases, you get what you pay for. When it comes to investing, you get what you don’t pay for.

You might notice that when you open up an account and hand over some money to be invested, it seems like it’s free. They don’t mention a price, they don’t send you a bill, they don’t ask for a credit card.

Of course, it’s not free, the fees are just well-hidden.

Every day stocks and other securities go up and down in price, causing the value of your portfolio to change daily. Amid the sea of…

How much could you save?

Photo by NeONBRAND on Unsplash

When it comes to saving money, it’s helpful to focus on the areas that make the biggest difference.

Most people spend most of their money on the “big three” categories:

  • Housing
  • Transportation
  • Food

Hosing and transportation involve a small number of important decisions that get locked in for a long time. Food, on the other hand is a category where you make decisions weekly. Or sometimes daily.

There are lots of ways to approach saving money on food. But the most important place to start is to tackle the question: Is it cheaper to cook or eat out?

How We Keep Score

To determine…

Only Borrow to Build

Abstract vector created by vectorjuice —

While personal finance can be summed up in less than 10 words, we can lay out the principle for borrowing in just four.

The Golden Rule of Borrowing is only borrow to build

Obviously those four words aren’t enough to fully explain the concept. It’s just an alliterative way to help you remember the rule.

Here’s what the rule means: Only borrow when the expected payoff from borrowing exceeds the cost of borrowing.

Let’s look at a few examples to illustrate this concept.

Three Times It (Might) Be Okay To Borrow

Student Loans

Investing in your education is like investing in your future earnings.

My wife went to school for…

And take vacations anyway

Photo by Chen Mizrach on Unsplash

In the personal finance classic Your Money or Your Life, Joe Dominguez and Vicki Robin make an important point about “escape entertainment.”

Notice that common phrase, “escape entertainment.” Escape from what? What is the prison or restrictive circumstance from which you must flee? If your experience of life were consistently fulfilling and exciting, from what would you escape? Would those hours in front of the television or movie screen be necessary?…How much of your weekend entertainment do consider your just reward for sticking it out at a boring Job?

Your Money or Your Life (1993 edition), pg. 62

Most of…

The math behind why it’s so easy to fall into debt and how much it costs

Infographic vector created by pch.vector —

Here’s a shocking fact: Visa makes around $20 Billion dollars a year.

Mastercard is right on their heels with $15 Billion. A few years ago, American Express came within spitting distance of making $40 Billion in a single year.

There’s a lot of money in issuing credit. How are these companies making their money? Off the people using their cards.

Why do consumers hand over such astronomical sums to these companies every year? The answer seems to be that in the short term credit cards seem like an impossibly good deal. But in the long run, they are a dangerous…

Put you money to work…

Image Credit: Author’s Image

Personal finance can be frustrating when you don’t have much money to work with.

If that’s you, then you should get to work on mastering the basics, especially earning more.

In the meantime, it’s good to know how to manage what little you have. If you can’t manage a little, what makes you think you can manage a lot?

To illustrate the point, let’s start really small. Here are five good uses of a mere $20:

Invest in the Stock Market

Let’s get this out of the way: You won’t get rich by investing $20. You won’t even get close.

But depending on how long…

Three helpful perspectives on debt

Hand vector created by freepik

Personal finance gurus are always preaching that you should get out of debt. But what exactly is debt and why is it so bad?

The boring, simple definition is that debt is borrowing money. It’s paying later instead of right now.

But why is this bad? Let’s look at three definitions of debt that fly in the face of good financial sense.

Debt is Borrowing From Your Future Self

Usually we think of debt as borrowing from a lender, or a creditor. This is true, it just misses part of what is happening.

If you don’t pay for something now, up front, you’re future self is on…

Matthew Kent

Done settling for average. Now I have my sights set on awesome 😎 Get “The Ultimate Daily Checklist,” my free ebook on productivity:

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store