A boat is not your financial friend, but a friend with a boat is.
REVISIT YOUR DEBTS. Think of borrowed money as a negative investment: Instead of making you money, it’s costing you. If you have high-cost debt, paying it off—or replacing it with lower-cost debt—should be a top priority. What about lower-cost debt? That might also be worth paying off, especially if the alternative is to buy bonds or CDs in a taxable account.
MANY EMPLOYEES deliberately have too much income tax withheld from their paycheck, so they receive a fat refund each spring. Federal refunds averaged $2,850 per income-tax return in 2014, the latest year for which data is available.
This is completely irrational and entirely sensible.
It’s irrational, because we’re making an interest-free loan to Uncle Sam. Why not have the correct amount of tax withheld, and then take a sliver of each paycheck and pop it in a high-yield savings account,
LIKE MOST PARENTS, my wife and I spent time and money building a happy and balanced childhood for our four children. That encompassed things like vacations, cub scouts, church, music, and youth soccer and baseball. But it also included trying to pass along values like hard work, thrift, generosity and education. We never hesitated to speak about our finances around the dinner table, although we only shared specific numbers when the kids got older.
I’VE LIVED IN BIG CITIES for the past six years—Cairo most recently and St. Louis before that. During that time, I’ve enjoyed inexpensive public transportation and nearby groceries. I never felt the need to buy a car, and it never made sense. But since moving to New Haven five months ago, my calculations have changed.
For the first time since high school, I’m back in the ‘burbs. I can walk or bike to class and to friends’
Jonathan Clements is the founder and editor of HumbleDollar. He spent almost two decades at The Wall Street Journal, where he was the personal finance columnist. His latest book: How to Think About Money.