5 ms·

My rules were: 1. Always pay off the credit card bill every month. Completely. 2. Mortgage payment < 40% of take home salary. 3. Buy the cheapest new car you

My rules were: 1. Always pay off the credit card bill every month. Completely. 2. Mortgage payment < 40% of take home salary. 3. Buy the cheapest new car you can afford and run it as long as possible. 4. Never buy branded clothing unless on sale. 5. Maintenance costs less than replacement. In summary be a cheapskate and ignore the neigbours with expensive doodads.

jleyank 4y ago
I am not sure that trying to fix modern appliances is really (or even on paper) cheaper than replacing them. Maybe for the expensive models, but the lower end units seem to be “use 5-10 and replace”. I worry that the fancy/modern car electronics will push cars into this category. Carmaker motivstions don’t align with mine.
- throwaway6977 4y ago
  Modern appliances are designed with parts that fail easily and are just slightly too difficult, or dangerous, enough to repair on your own. Usually it's a plastic connector of some sort that will have an easily calculable time-to-disintegration measured in years. For instance, I just fixed a 2c plastic clip that pretty much made my microwave unusable by virtue of the door being un-openable. In order to do so, I had to have my fingers about 3 inches away from a bare wire transformer which near totally obstructs what should be a very simple fix. Plenty scary and dangerous enough for me to have to call the manufacturer and find a certified local repairer...
- cbm-vic-20 4y ago
  If your appliances are low-tech enough, and you have access to YouTube and don't have hand dexterity issues, you don't need to replace or even pay for a service visit. I've fixed a clothes washing machine when its belt seized. That was $17. My refrigerator was no longer staying cold: a $50 controller board clone from eBay works great.
- bombcar 4y ago
  It depends on the appliance, and yeah, the cheaper ones are often NOT worth fixing if a major component breaks, but ARE worth fixing if it is a minor component/known issue. Youtube is great for this - search "model number" "problem" and if there's a video on how to fix it, it's common enough that the part is probably cheap (think ignitor for a dryer/oven, etc). Friend had an older washer with a giant "timer dial" that was cheap to fix - the new dial cost like $50 and was simple to replace. A similar washer that I had had a single plastic part that held the dial in place break, and the only way to fix it was either bolt some metal strapping around it (which I did) or buy a new faceplate at $350 (+ shipping) - that's half the cost of a SpeedQueen (which I eventually bought when the pump crapped out. The SpeedQueens don't change year to year and they're basically laundromat machines so they're very repairable. If you do decide to replace an appliance, there are people that will take away the old one for free, because they will repair and resell if possible.
mattw2121 4y ago
I'm with you on all of these except the mortgage/rent payment. 25% should be the goal IMO. I know it can be tough, especially at lower income levels. My solution for that is, if your income can't afford it then you need roommates.
- jimmaswell 4y ago
  The housing market is cooling somewhat, but 25% is still pretty hard to hit today unless you're a high earner in a low COL area. I'm at 26% take home doing WFH in rural New Hampshire. Likely not practical if you live anywhere more urban than that. Rent or mortgage up to 50-60% is more common today.
- deleted 4y ago
  [deleted]
- fuckstick 4y ago
  > mortgage/rent payment These are not the same at all. > 25% should be the goal I think 70% should be the goal - why? Because I pulled it out of my ass. Do you have a sound financial explanation for this benchmark, because it sounds like arbitrary dick sizing. 60% of income on a mortgage in a relatively stable area without insane property taxes is likely a very prudent allocation of income, since you both have a good investment and a place to live. Spending 60% or even more of income on a mortgage may well be better than 25% on rent. Another thing, 25% of income is very different at $30k then it is at $300k. This is something the budding personal finance advisor should understand. > then you need roommates Is that what you’re going to tell people in their 30s with kids?
  - bombcar 4y ago
    > Is that what you’re going to tell people in their 30s with kids? Kids are just roommates that never help with the rent. ;)
  - mattw2121 4y ago
    Yes, if you are in your 30's with kids and not making enough to afford your bills, you need more jobs, higher paying jobs, or roommates.
ehnto 4y ago
I would add, if your city permits it, buy a bicycle, or take public transport. You can have a car too, but every single trip you don't do in it is money saved. Kids are calling this "low car", in contrast to no car. Car dependence sneaks up on you, one moment you're a teenager with no costs the next you've got thousands a year in running costs and you're wondering where all your money is going. Fuel costs become non-negotiable, and maintenance is both hidden and a Russian roulette as to whether or not something major breaks. Every time you don't drive the car, you play the maintenance slot machine one less time, and the accumulated effect of lower maintenance costs and lower gas is non-trivial. The other thing I would add is to be honest with yourself, add up the car costs, rego, gas, tires, the maintenance schedule (you have a schedule even if you don't follow it). Your $20,000 dollar car probably costing you thousands a year.
- jimmaswell 4y ago
  Even better, an e-bike. There won't be so much friction to getting yourself to use it, especially if you have hills that would be insurmountable to the untrained leg.
  - fassssst 4y ago
    E-bike is the most life changing purchase I’ve made in the last few years. Besides all the financial and health benefits, the biggest benefit is all the fun. Even a boring errand run becomes a nostalgia-filled, wind-in-your-hair joyride. Plus you can park right out front of wherever you’re going.
    - ehnto 4y ago
      Totally agree. I ride person-powered bikes all the time but my e-bike changed the game for me even still. I live in a fairly hilly part of Australia, and there is no direction that does not take a level of athleticism for me to do in a reasonable amount of time. Heatwaves also rule it out from time to time. Not so with an e-bike, it really takes the rough edges off any commute and because of that I use it way more often. Anything that gets you on the bike more often is a good thing.
jfk13 4y ago
Also, 6. Learn to cook. https://www.bbc.co.uk/food/collections/1_dinners https://www.bbc.co.uk/food/collections/1_dinners And make your own coffee.
- ehnto 4y ago
  I am actually embarrassed by the amount I spent on coffee before getting a machine. At $5aud a coffee, 3 per day, $15 a day, 233 work days in a year, $3,495 per year for 10 years, $34,950AUD. My esspresso machine cost me $500AUD and a bag of beans that does 60-70+ coffees costs me $15. Idiot!
  - SanjayMehta 4y ago
    I went to a Star Bucks today after a gap of 13 years. They're easily 5 times more expensive than the regular cafes here. INR 231 for a "tall Americano." I think one should pop into these joints once in a while to appreciate being a cheapskate quantitatively speaking.
elboru 4y ago
As a kid I felt my family was “poor”. My uncles and aunts had bigger and nicer houses/cars than my parents. My cousins had really cool toys and they rarely got a no when they wanted an expensive candy. My foolish child mind saw all that and thought we were “poor”. What I didn’t know was that my parents had bigger salaries than their relatives. They just didn’t give a damn about expensive stuff. Later in life the same relatives struggled really bad when their incomes decreased, and they weren’t able to afford the lifestyle they were used to. My family in the other hand never really went through economic struggle (at least it was not apparent to me and my siblings) even when my father lost his job and took him 6 months to get a new one. My parents now live in a really nice house but they still have the ugliest and oldest cars ever lol. But that always reminds me to not fall for expensive stuff just because I can afford it.
harimau777 4y ago
I would probably change 4 to "Never buy clothing because of the brand". If someone cares about clothing then buying high quality, well designed, and fashionable clothing makes sense. Unless the clothing is custom made, which is generally even more expensive, that means that the clothing will be brand name.
- SanjayMehta 4y ago
  Most branded clothing is made in the same factories ("sweat shops") here as the no-name versions. I'm wearing a pair of jeans which cost me INR 500/- versus INR 2000/- on amazon (the retail price is INR 4000/-).
Balgair 4y ago
Oh gosh, I feel like a dirty peasant here. Those rules (to me) are a fair bit high living. For my personal tastes, I would edit it to: 2. < 25% of net pay 3. NEVER buy new, only buy used, drive it into the ground and smoking 4. NEVER buy new, only buy via a thrift store (except undies and socks, buy those cheaply)
- SanjayMehta 4y ago
  Buying a used car could have the downside of unexpected repairs.
  - Balgair 4y ago
    True, but that's why you get it inspected by your mechanic before buying. I'm also pretty handy with tools, so minor issues that I can flat-back I'll handle myself. Also, right now is a terrible time to buy new or used cars.

jleyank 4y ago

I am not sure that trying to fix modern appliances is really (or even on paper) cheaper than replacing them. Maybe for the expensive models, but the lower end units seem to be “use 5-10 and replace”. I worry that the fancy/modern car electronics will push cars into this category. Carmaker motivstions don’t align with mine.

throwaway6977 4y ago
Modern appliances are designed with parts that fail easily and are just slightly too difficult, or dangerous, enough to repair on your own. Usually it's a plastic connector of some sort that will have an easily calculable time-to-disintegration measured in years. For instance, I just fixed a 2c plastic clip that pretty much made my microwave unusable by virtue of the door being un-openable. In order to do so, I had to have my fingers about 3 inches away from a bare wire transformer which near totally obstructs what should be a very simple fix. Plenty scary and dangerous enough for me to have to call the manufacturer and find a certified local repairer...
cbm-vic-20 4y ago
If your appliances are low-tech enough, and you have access to YouTube and don't have hand dexterity issues, you don't need to replace or even pay for a service visit. I've fixed a clothes washing machine when its belt seized. That was $17. My refrigerator was no longer staying cold: a $50 controller board clone from eBay works great.
bombcar 4y ago
It depends on the appliance, and yeah, the cheaper ones are often NOT worth fixing if a major component breaks, but ARE worth fixing if it is a minor component/known issue. Youtube is great for this - search "model number" "problem" and if there's a video on how to fix it, it's common enough that the part is probably cheap (think ignitor for a dryer/oven, etc). Friend had an older washer with a giant "timer dial" that was cheap to fix - the new dial cost like $50 and was simple to replace. A similar washer that I had had a single plastic part that held the dial in place break, and the only way to fix it was either bolt some metal strapping around it (which I did) or buy a new faceplate at $350 (+ shipping) - that's half the cost of a SpeedQueen (which I eventually bought when the pump crapped out. The SpeedQueens don't change year to year and they're basically laundromat machines so they're very repairable. If you do decide to replace an appliance, there are people that will take away the old one for free, because they will repair and resell if possible.

mattw2121 4y ago

I'm with you on all of these except the mortgage/rent payment. 25% should be the goal IMO. I know it can be tough, especially at lower income levels. My solution for that is, if your income can't afford it then you need roommates.

jimmaswell 4y ago
The housing market is cooling somewhat, but 25% is still pretty hard to hit today unless you're a high earner in a low COL area. I'm at 26% take home doing WFH in rural New Hampshire. Likely not practical if you live anywhere more urban than that. Rent or mortgage up to 50-60% is more common today.
deleted 4y ago
[deleted]
fuckstick 4y ago
> mortgage/rent payment These are not the same at all. > 25% should be the goal I think 70% should be the goal - why? Because I pulled it out of my ass. Do you have a sound financial explanation for this benchmark, because it sounds like arbitrary dick sizing. 60% of income on a mortgage in a relatively stable area without insane property taxes is likely a very prudent allocation of income, since you both have a good investment and a place to live. Spending 60% or even more of income on a mortgage may well be better than 25% on rent. Another thing, 25% of income is very different at $30k then it is at $300k. This is something the budding personal finance advisor should understand. > then you need roommates Is that what you’re going to tell people in their 30s with kids?
- bombcar 4y ago
  > Is that what you’re going to tell people in their 30s with kids? Kids are just roommates that never help with the rent. ;)
- mattw2121 4y ago
  Yes, if you are in your 30's with kids and not making enough to afford your bills, you need more jobs, higher paying jobs, or roommates.

ehnto 4y ago

I would add, if your city permits it, buy a bicycle, or take public transport. You can have a car too, but every single trip you don't do in it is money saved. Kids are calling this "low car", in contrast to no car. Car dependence sneaks up on you, one moment you're a teenager with no costs the next you've got thousands a year in running costs and you're wondering where all your money is going. Fuel costs become non-negotiable, and maintenance is both hidden and a Russian roulette as to whether or not something major breaks. Every time you don't drive the car, you play the maintenance slot machine one less time, and the accumulated effect of lower maintenance costs and lower gas is non-trivial. The other thing I would add is to be honest with yourself, add up the car costs, rego, gas, tires, the maintenance schedule (you have a schedule even if you don't follow it). Your $20,000 dollar car probably costing you thousands a year.

jimmaswell 4y ago
Even better, an e-bike. There won't be so much friction to getting yourself to use it, especially if you have hills that would be insurmountable to the untrained leg.
- fassssst 4y ago
  E-bike is the most life changing purchase I’ve made in the last few years. Besides all the financial and health benefits, the biggest benefit is all the fun. Even a boring errand run becomes a nostalgia-filled, wind-in-your-hair joyride. Plus you can park right out front of wherever you’re going.
  - ehnto 4y ago
    Totally agree. I ride person-powered bikes all the time but my e-bike changed the game for me even still. I live in a fairly hilly part of Australia, and there is no direction that does not take a level of athleticism for me to do in a reasonable amount of time. Heatwaves also rule it out from time to time. Not so with an e-bike, it really takes the rough edges off any commute and because of that I use it way more often. Anything that gets you on the bike more often is a good thing.

jfk13 4y ago

Also, 6. Learn to cook. https://www.bbc.co.uk/food/collections/1_dinners https://www.bbc.co.uk/food/collections/1_dinners And make your own coffee.

ehnto 4y ago
I am actually embarrassed by the amount I spent on coffee before getting a machine. At $5aud a coffee, 3 per day, $15 a day, 233 work days in a year, $3,495 per year for 10 years, $34,950AUD. My esspresso machine cost me $500AUD and a bag of beans that does 60-70+ coffees costs me $15. Idiot!
- SanjayMehta 4y ago
  I went to a Star Bucks today after a gap of 13 years. They're easily 5 times more expensive than the regular cafes here. INR 231 for a "tall Americano." I think one should pop into these joints once in a while to appreciate being a cheapskate quantitatively speaking.

elboru 4y ago

As a kid I felt my family was “poor”. My uncles and aunts had bigger and nicer houses/cars than my parents. My cousins had really cool toys and they rarely got a no when they wanted an expensive candy. My foolish child mind saw all that and thought we were “poor”. What I didn’t know was that my parents had bigger salaries than their relatives. They just didn’t give a damn about expensive stuff. Later in life the same relatives struggled really bad when their incomes decreased, and they weren’t able to afford the lifestyle they were used to. My family in the other hand never really went through economic struggle (at least it was not apparent to me and my siblings) even when my father lost his job and took him 6 months to get a new one. My parents now live in a really nice house but they still have the ugliest and oldest cars ever lol. But that always reminds me to not fall for expensive stuff just because I can afford it.

harimau777 4y ago

I would probably change 4 to "Never buy clothing because of the brand". If someone cares about clothing then buying high quality, well designed, and fashionable clothing makes sense. Unless the clothing is custom made, which is generally even more expensive, that means that the clothing will be brand name.

SanjayMehta 4y ago
Most branded clothing is made in the same factories ("sweat shops") here as the no-name versions. I'm wearing a pair of jeans which cost me INR 500/- versus INR 2000/- on amazon (the retail price is INR 4000/-).

Balgair 4y ago

Oh gosh, I feel like a dirty peasant here. Those rules (to me) are a fair bit high living. For my personal tastes, I would edit it to: 2. < 25% of net pay 3. NEVER buy new, only buy used, drive it into the ground and smoking 4. NEVER buy new, only buy via a thrift store (except undies and socks, buy those cheaply)

SanjayMehta 4y ago
Buying a used car could have the downside of unexpected repairs.
- Balgair 4y ago
  True, but that's why you get it inspected by your mechanic before buying. I'm also pretty handy with tools, so minor issues that I can flat-back I'll handle myself. Also, right now is a terrible time to buy new or used cars.