Slow Down the Velocity of Your Money and Slow Down Your Spending

According to Investopedia, the "Velocity of Money" is defined as -

The rate at which money is exchanged from one transaction to another, and how much a unit of currency is used in a given period of time. Velocity of money is usually measured as a ratio of GNP to a country's total supply of money. 

 

It's a term that I remember from Economics 101 -- a valuable course that continues to help me explain being perpetually broke.  While the velocity of money is an obscure term that economists use to measure how quickly money is being circulated in an economy and the health of an economy, I just think about slowing down the rate at which money leaves my personal bank account.

 

 Do we really have to spend our money so fast?  If you put off a purchase until tomorrow, then your money gets to stay in the bank for another day.  Tomorrow, you might not still want to make that purchase or an emergency might crop up and divert that money to a more important end.  My thought is that if you can keep postponing purchases, some of the money might not ever leave your account.  You might even save some money.

Every pay period, we pay our bills and try to live on the meager amount that is left.  Every day that money is in the account and is unspent is a day that we aren't broke.  Every day that we don't spend puts off the day that we have to rely on a credit card or a line of credit.

The moral of this story:  Don't buy today what you can buy tomorrow or next week or next month or never.

Cutting Back on Expenses

In America, it is hard to cut back on expenses and save money.  We are constantly bombarded by commercial marketing messages and we constantly see seemingly affluent people sporting the latest gadgets and driving the latest cars.  When you try to keep up, you can easily find yourself on a never ending treadmill of purchases and payments.

Fortunately, we are not alone.  There are plenty of Americans who are trying to forego silly spending, retire debt, build up retirement nest eggs, and build wealth.  I recently read a good article on Yahoo Contributor's Network by Damon Malcom who outlines ways to cut spending and build wealth:

6 Ways to Cut Back on Spending and Save Money

Saving Money on Exercise and Fitness Equipment

Happy New Year!  The "eating season" is over!  Now, it's time to get serious about all those weight loss New Year's Resolutions.  Of course, it can be tough to buy a gym membership or outfit a home gym when you are paying down Christmas bills. 

Fortunately, there is an alternative.  I should probably call it "Thrifter-cize!" You can find everything you need second-hand at your local thrift store!

Every exercise fad eventually ends up at the thrift store.  All you have to do is go down to your local Goodwill and dig the second-hand fitness gear out:

Low Price Exercise and Fitness Equipment to Find at Thrift Stores

Remember the Ab Rider?

Here is a Weight Stand

Get on the Ball and Start Exercising!

Equipment and gear won't stand in your way this year!  Grab what you need and start exercising!

How to Recover from a Christmas Spending Spree

A Guide to Overcoming Christmas Bills

Did you get sucked in by the lure of Black Friday Deals? Did your Christmas shopping list grow too long? Were you naughty with your credit cards while trying to be nice to everyone on your list? Here's how to recover and right your financial ship!


An exciting December can make for a boring January, but you have to get your personal finances in order. The first thing to do after an expensive Christmas is take stock of where you are financially. Take a look at your credit card balances and your bank account balances. Take a deep breath. You don't have to assume another identity and move to South America. There are things you can do.

 

Make The Return Quest. If you've recently bought frivolous consumer products for yourself and you don't actually need them and you haven't actually used them, take them back. It may not be fun going from store to store making returns, but it can help your finances. We call that trip "return quest." The credits for returning un-needed items should help lower your credit card balances and offset some of the charges you made. If you have food, clothing, shelter, and transportation, you have what you need. You can do without some of the frivolous things you bought.

 

Do The Balance Transfer Shuffle. Do you have any incoming credit card offers for 0% interest on balance transfers? One of those cards might be a place to park some of that Christmas debt until you can pay it off. Alternatively, you may want to approach your bank or credit union about a consolidation loan before you are late with any payments.


Cut Your Cable Expenses. Football season is over. If you aren't a rabid basketball fan, this might be a good time to call the cable company and cut some of those sports packages and sports channels. You could examine your cable bill and cut back to a less expensive package. If you save $20 to $40 per month on your television expenses, you could easily apply that money to beat down a growing credit card balance.


Eat at Home. After Christmas, the weather is cold and the nights are dark. Winter is not a bad time to stay inside, hunker down, and eat home-cooked food. Cheap meals at home can really help you fit into a tight budget. You can apply the money you save towards your post-Christmas credit card bills. When you do eat out, use every trick in the book to save money at restaurants. It won't be fun, but worrying about bills isn't fun either.


Stop Shopping. Shopping for Christmas was fun. But, you don't have to keep shopping after the holidays. If you have your basic needs met, just chill out and let those credit cards cool. You can beat down those Christmas balances in a couple of months. In the meantime, just don't buy anything that you don't absolutely need.


You'll get your finances back in shape in just a couple of months. In the meantime, don't panic and just make sensible adjustments to lower your spending. Christmas bills will fade away before spring.

A Flat Broke Christmas

We hope you have a Merry Christmas and a Happy New Year!  Sometimes, when finances are tight, you actually get to focus on the reason for the season instead of the material aspects of the holiday.  Christmas is always a tough season financially.  But, this year, we put together a great tree. 

Goodwill Tree and Dollar Tree Ornaments

 We got a 4 or 5-foot tree that is perfect for our apartment.  It has LED lights built in and a golden base.  Best of all, it was only $10.91 from Goodwill.  We decorated it with a star, ornaments, and garlands from Dollar Tree.  We probably have $6.00 in ornaments on the tree and it looks really good!  When the LED lights are turned off it looks like a typical tree, but when the LED lights are on and the room lights are off, the tree really looks magical!

When money is tight, a little ingenuity can provide a lot of fun.  We have enjoyed free military band Christmas concerts, thrift store Christmas music CD's, and free holiday light displays.  Churches also put on live nativity scenes and Christmas pageants.  Cities and towns have tree lighting ceremonies.  Just keep your eyes open and you'll find plenty to do!

How to Save Money by Avoiding Convenience Stores

Being Prepared Can Help You Avoid the High Cost of Road Food

As Americans, we love to get food, snacks, and little necessities at convenience stores.  However, we pay for that convenience in the form of higher prices for many items.   Here's how you can avoid the high cost of convenience stores.

As Americans, we love to get food, snacks, and little necessities at convenience stores. Stores like QuickTrip are open 24 hours a day, 7 days a week, and have everything you need to survive. However, we pay for that convenience in the form of higher prices for many items. A quick look at our bank statement shows that we fritter away quite a bit of money at convenience stores. If you want to save money, you can avoid convenience stores by simply being prepared.


Beverages are one of the main things we buy at convenience stores. It is easy to pop in for a soda, tea, or bottle of water. Staying hydrated is important. But, even when fountain drinks are priced as low as 79 cents, you can still save money by bringing a beverage from home. You can buy bottled water or soda by the case, refrigerate it, and make it a habit to grab a beverage on the way out the door.



Snacks are another easily avoided convenience store temptation. Instead of paying for a small bag of chips at the convenience store, buy a big bulk bag of chips at the grocery store. Then divide your less expensive big bag of chips into small "grab and go" sized lunch baggies. The same principle applies for candy, granola bars, and other snacks. Buy cheap at the grocery, divide into smaller servings, and grab a snack bag for the road. This may also help you avoid the temptations of less nutritious snacks at convenience stores.



If you are committed to avoiding convenience stores, you may want to invest in a couple of items for your car. First, a little cooler can help keep those "grab and go" beverages cold. For longer road trips, you may even want to get a mini fridge for your car. A little mini fridge can run off of your cars cigarette lighter or auxiliary power port. You may also want to buy a seat back organizer bag for storing portable snacks. These items will help you stock up your car before you set off on a drive.



By staying out of convenience stores, you'll avoid that little $5 to $10 drain of a munchie run each time you go for a drive. In the course of a month or a year, those little convenience store runs can be a drag on your family budget. You may even find out that the convenience store was where all your money went.

Are Refurb Computers Any Good?

 If you are like me, you've been intrigued by advertisements for refurbished computers.  If you are looking for a truly affordable PC, it is almost impossible to find a brand new machine for less than $150.  Most entry level machines start at $279.  There seems to be a conspiracy afoot when it comes to PC prices.  The one low price alternative that is still available to common people is the refurbished PC.  Prices for refurbished computers start as low as $99 at common outlets like Sears.com and Microcenter.

Of course refurb machines aren't like brand-name computers.  They often come in plain brown boxes and they have limited warrantees.

I recently took the plunge and bought a refurbished HP desktop machine from Microcenter.com.  

It had a dual core Intel processor, 2GB of RAM, and Windows 7 for only $139.  It was still a lot of money, but we felt we need to get a Windows machine back in our home.

For more information, you can read a complete review of our buying experience and our new refurb PC:

Personal Computer Review:  HP DC7900 Refurbished Desktop Computer from Microcenter.

I would recommend looking for a Windows 7 machine as Windows XP will soon be out of Microsoft support.  Here are some affordable refurb computers offers, check them out: