This post is for all the frugalistas out there.  I was clearing out my closet the other day when I came across my favourite pair of jeans.  They’re Hudsons (you know, the jeans Jessica Alba, Katherine Heigl, and Kate Hudson wear). Of course I took a minute to admire them- so much so I took a picture of them lol…  I bought them about three years ago in the states, and I’ll admit, they were over $100.  $150 to be exact.  Back then, I vowed to myself to never ever buy $100+ pair of jeans.    When I look back though, I wear these jeans a LOT.  Probably about 80% of the time.  They always fit nicely, they make my small butt look decent (the secret is the pocket placement, girls), and they don’t give me a muffin top (which is a look that is getting harder and harder avoid achieving these days, believe me).  They haven’t even torn yet (knock on wood).

I have a philosophy when it comes to clothes shopping.  If something makes you look good, I mean- really good, and you know you’re going to wear it a lot, and it’s a key staple, then you should buy it.  I often think of money spent on clothes as “cost per use”.  So the first time I wore those jeans, they were $150.  The second time, they cost $75/day.  The third time, they cost $37.50… you get the point.  I know it’s not mathematical or scientific by any means, but I feel that the more I wear something, the more “worth it” it becomes.  You’ll know it’s worth the money you spent on it when you’ve used it so many times that you’ve lost count.

I used (er.. sometimes still am) to be a hardcore warehouse sale shopper.  Sometimes I would buy something because it was a good deal.  I would get a pair of brand name jean shorts that normally cost $89 for only $16.  Trying it on in the change room, I would tell myself “hmm it looks alright…it’s a bit high waisted for me, but it’s such a good deal!  I’m sure I’ll get good use out of it”.  Then I would wear it once and realize how terrible those jean shorts look and then they would sit in my closet for a good year.  I would try my best to love them, but it usually never works out.

Those $16 pair of jean shorts, that $10 top, that $25 dress.  They all add up and accumulate in a neglected pile in your closet.  However, if something’s on sale and  you absolutely love it and  you can see yourself wearing it all the time and putting good use with it (e.g. if it was a key wardrobe staple, something that you need, etc), that’s even better!

I’m just saying that sometimes things that are regular priced and a bit more expensive can be justified (at times).  Especially if you often have a hard time fitting jeans that make you feel good about yourself.  Now I’m not advocating for you to all buy a dozen pair of $100+ jeans.  One or two pairs is enough I think.  Nor am I advocating for you all to go on and shop til you drop at Christian Louboutin (where shoes are over $1000+), there is a reasonable limit, wouldn’t you say?

PS… I went to Macy’s recently and saw some Hudson jeans again.  I was very tempted to buy another pair in a different wash, but resisted the temptation and am proud of myself for doing so.   I did go so far as to try them on though!

Readers, do you own a pair of $100+ jeans? Do you have a few key pieces that you believe are okay to spend a bit of extra money on? Do you have the same “calculations” I use to justify a piece of clothing (or am I just weird)?

Related posts:

1. How to tell if splurges are “worth it”
2. One Person’s Trash is Another One’s Treasure: Clothes Swap!
3. How to Get your Money’s Worth at an All-You-Can-Eat-Buffet

We all have grooming maintenance that we need to do to keep ourselves looking presentable to others, and especially your significant other.  I personally don’t like adding any sort of regular monthly expense unless I absolutely have to.  I have many friends who get pedicures on a monthly basis.  I personally go perhaps.. once a year for a bachelorette or birthday party or some other event that renders it necessary to go.  One friend has been asking me to go for monthly pedicures with her.  At $35+tip a pop each time for some scrubbing, cuticle pushing, filing, and nail bed painting (which adds up to a whopping $450 a year), I told her that I just do it myself and I could do hers too, if she wants to pay me $35+tip a month (of course I was just joking…I think).

So here I go, analyzing how much I spend on being presentable to the rest of the human race.  Guys, if you are somewhat squeamish about grooming, please look away (or don’t click on the “continue reading” link lol)!

HAIR: I do go and get my hair done twice a year (much to the chagrin of my BF, but tough luck for him) but go “all out” when I get my hair done (dyed and cut) which costs about $175 including tips.  I’ve been to a gazillion hair stylists and finally found one that I like and does a good job, so I’m keeping him even though he costs me an arm and a leg.

My BF gets a hair cut around monthly for $35 or so.  Other than that, he doesn’t have any regular grooming expenses.

I know many guys who cut their own hair (and don’t do a bad job), so being able to do that is a fantastic money saving skill.

BROWS: I get my eyebrows threaded about every 6-8 weeks as well, and this costs me $5.  Ever since I’ve discovered threading, I have been much too lazy to tweeze my eyebrows.  Threading is where the esthetician takes a piece of white thread (same as the thread you would sew with) and somehow magically twists the thread so it catches the hair and yanks them out.  It’s basically like tweezing on crack.

I have a friend who goes to get her eyebrows tweezed by a well known esthetician and it costs $40 a session, but boy, do her eyebrows always look great.

WAXING: I don’t wax my legs, I use an Epilator.  The Epilator is this tortuous looking device that has three metal grips that pulls each hair out three at a time in a quickly rotating fashion.  It’s the greatest thing since sliced bread in my mind- it costs about $50 but lasts forever.  The pain you get initially subsides after a few more uses of the Epilator.

FACIALS: Again, this is something that once you get hooked, can become a very expensive monthly expense.  I have gotten a facial once, it was lovely but expensive (I think to the tune of $70).  I bought another one thanks to Groupon (sigh).  It was 50% off or so, so I obliged.  This marks the second time I’ll be having a facial in about 5 years.

I believe those are all my grooming expenses.  There’s another one that I do regularly but I would much rather not share the details, but it’s in the realm of waxing.

I try to keep my expenses down as much as possible and do only the things through a salon that I can’t do myself.

Readers, how about you… How many times do you: Wax, “get your hair did”, get your nails done?

Do you review your grooming expenses regularly? Do you think that grooming is a area in personal finance that shouldn’t ever been compromised or sacrificed?

No related posts.

When I was younger, my mom once asked me a question that really helps you understand yourself a bit better, and what your values are.

Although it may not seem so blatant and in-your-face, money is the currency of the experiences and material goods that we assign value to.

She asked me if I had a million dollars (yeah yeah, a cool million isn’t that much nowadays–can’t even buy a detached house in Vancouver for that, really), what would I spend it on?  Let’s play ‘pretend’ for a bit.

If you had a million dollars and could only concentrate it on ONE area below, what would you spend it on? (the other areas in your life would be lacklustre to say the least)

The options are:

• House
• Clothes/ Fashion
• Travel
• Car
• Food

For the House option, you would live comfortably in a nice house, in a nice area, with a beautifully designed interior, with or without a nice view.  But you would not be able to eat out, you would drive a car that is reliable and 10 years old, and not flashy, no designer clothing, and no travel.

For the Clothing option, you can buy all the name brands, and $250 jeans (like Rock and Republic, True Religion) are a staple in your closet.  Girls, you have a collection of the Louis Vuitton and Chanel bags (and no, they’re not replicas bought off the street, either!), you also have a nice collection of Christian Louboutins, Jimmy Choos, and other designer shoes that cost $1000+.  Guys, you own Hugo Boss suits and coats.  People envy your fashion sense and designer style.  Heck, even Sex and the City Carrie will envy your closet.

For the Travel option, you are able to afford to travel the world.  One of your goals is to travel to every continent of the world.  You will not have to live in hostels either and share your accommodation with cockroaches and bedbugs when you’re traveling South East Asia (unless you want to, ofcourse).  You will be able to afford to take a year off and travel.  You will be able to see the seven wonders of the world and travel to far away and exotic places like Bhutan (and not just have to stay for 4 days or less because it costs $200 a day to stay there!) and see Antarctica.  Going to Dubai is nothing for you, and you don’t bat an eye (or have a heart attack) when the hotel bill comes for your stay at the Burj Al Arab where it costs $2000 a night to stay there.

For the Car option, you will be able to drive a nice car, Mercedes, BMW’s, Bentley, or Ferrari and Lamborghini if you wish.  The car will have all the bells and whistles, but you will be living in a very modest part of town (and risk having your car stolen or broken into), and no traveling, no eating out, and plain non-designer wear.

For the Food option, you will be able to afford beautiful food, you can dine at steakhouses (Morton’s etc.) every week if you like.  You and your partner are able to go to beautiful restaurants overlooking the ocean, delicious flavours tease and tantalize your taste buds, and the variety of dinners and lunches available to you are endless.  (and just to put a cherry on top of the cake in this imaginary scenario, you will not gain weight and your cholesterol levels stay normal, lol!)

So?  What will it be for you?  Please share what you picked and why. =)

For me, I think I value traveling as well as a nice house.. I think they’re equal for me, though traveling right now is slightly crawling ahead of housing for me.  I learn so much about other cultures, make new friends from around the world, I have memories and experiences that will last a lifetime, and I have awesome photos to remember everything by.  I also have this goal to see all the tallest peaks on our beautiful planet earth (see, not climb!) so am hoping to climb Mt. Kilimanjaro in a few years time (while my knees are still good!) and see Mt. Everest.

Anyways, enough imagination!  In the meantime, I’ll be working hard to try and get that million in the near future.

Related posts:

1. youngandthrifty joins the “Million Dollar Club”

2009 is coming to an end.  I can’t believe it’s been a year already… I can’t believe we’re heading into 2010!

(Vancouver is going to be a gong show in 2010, by the way with the Olympics.  I just know it.)

Here’s an update on my financial status:

Total Net Worth: $79,300

Here’s the breakdown:

ASSETS:

CASH:

$24,500

I added up:

• BMO banking account that my paycheck is sent to
• the Manulife high interrest savings account that is earning me about 1% (that I have automatically deducted from my BMO banking account) and
• money that is sitting there in my Questrade Trading account waiting for some action
• I’m keeping so much money in cash in case I want to  take some money out for my down payment
• Also a big chunk of that will disappear when I go on my traveling spree to Asia for five weeks (I anticipate about $5500- more on that later)

STOCKS:

$21,800

These are stocks that captures the  “moment in time”, including unrealized gains or losses in my BMO Investorline and Questrade accounts.  I added up USD and CAD stocks as “Canadian” money to be simplistic.

I have recovered mostly from the huge stock market crash, I think I am down about $1000.

RRSP:

$20,000

This includes some emerging market mutual funds (BRIC), the TD E-Series account, and some ETF stocks I have in my BMO Investorline account.

I hope to max out the $25,000 and withdraw for my first home purchase (hopefully soon) with this amount saved.

PENSION:

I am a public sector employee (hurrah for good-lookin’ pensions!) but am not including it in this net worth update because I want to keep it simple, and to be honest, I’m too lazy to calculate how much I have in it.

OTHER:

$8,300 (initial investment was$13,000)

I have some investments that were poor choices (I signed up for them before I became “edumacated”) that are losing money big time.  Some flow through shares, Venture investments that gave out a tax credit, and some more mutual funds.

TFSA:

$5000 Principal protected through an HSBC investment

CAR:

I’m not going to bother counting the car.  It’s 10 years old and I’m planning to drive it to the ground.

LIABILITIES:

CREDIT CARD:

$300

Don’t get your panties up in a knot, I don’t carry a balance (and nor should you), but this was taken a “moment in time” and as you can see from the low amount, it was early in the month.

Goals for 2010

• I hope to buy my first home next year.  Hopefully the housing prices will have decreased and the housing bubble will have burst.  Since November 2008 last year there’s been an increase of 232% in housing sales in Vancouver!  The low interest rates have been driving up the housing prices like crazy.  Considering that you would ideally need 25% down payment, for a $350,000 condo (standard 1 bedroom condo price here) I would need $87,500.  So I’m not really there yet.  That will be my goal. To get there with a little bit of cash cushion beyond the down payment amount.  The Bank of Canada will likely increase the interest rates too next year, possibly in the tune of 2-3% so you variable mortgage people should lock it in!  Because 2-3% is HUGE. It could mean thousands!

• I have gotten into the habit of calculating my net worth every month now (It’s actually kind of fun) to make sure I am going in the + zone, not the -.  I hope to continue this into 2010.

• I am contemplating whether to get a newer car next year.  If I get a newer car, I can start from scratch with my Capital Cost Allowance calculation and tax deduction.  Right now, I am kind of “bottoming out” with regards to how much money my car is worth on tax forms.  On the other hand, I just bought $1000 winter tires last year (thanks….Kal Tire) and want to get some good wear out of them.

• Lastly, I hope to recuperate the losses that I have, mainly from the “adventurous” investments I did with investment advisers before I knew anything about investing.  I have been a bit more aggressive with the stock market lately, so hopefully I will be able to recoup in this way.

What are your personal finance goals for 2010?

If you own equities, are you finding that you have recovered most of your investments?

Related posts:

1. youngandthrifty Net Worth Update: February 2011
2. youngandthrifty Net Worth Update: May 2011
3. youngandthrifty Net Worth Update: March 2010

Rich Dad Poor Dad

By: Robert Kiyosaki

Rich Dad Poor Dad is the “quintessential” book for every person interested in personal finance, it seems.  Everyone has heard of it.  If you haven’t, you’ve probably been living under a rock.  I have read a few financial books and have always wanted to read Rich Dad Poor Dad, especially since I see their free conventions/ seminars being hosted here so often (haven’t gone to one, but I hear they are ploy to make you buy their merchandise and classes…)

He has a really clear and direct writing style and used many examples and vignettes that he says are true to draw the reader. Some of his stories seem almost “too good to be true”, if you know what I mean. He also mentions his CASHFLOW game and the importance of getting educated on financial literacy. The CASHFLOW (he capitalizes it in the book, so I guess I will too) game seemed pretty interesting, until I saw that it is $150 USD- but I guess education is priceless, right?). Some parts of the book seemed a bit propaganda-ish in relation to buying his board game and attending his Rich Dad Poor Dad seminars.

The book starts off describing his childhood and his influence from both his rich dad (his good friend’s father) and his poor dad (his own father).  Throughout the book he draws comparisons between the two.  The rich dad is non-traditionally educated self employed and very entrepreneurial, the poor dad is highly educated in the traditional sense, works for the government, and values education and stability.

He then goes on to talk about the cashflow quadrants of wealthy people, poor people, his rich dad, and his poor dad.  He emphasizes that wealthy people find a way to make their liabilities and expenses small, they manage to loop them back into assets to generate income.

In all sections he talks about avoid paying paying taxes to the government by working for yourself and not someone else.  He writes about how he educated himself by experience, rather than traditional school.

Then to finish he gives more examples and suggestions on how to get out of the rat race.  He emphasizes that most people think that their home is an asset, when it can actually be a liability as it is not generating cash flow, which is a pretty good insight, in my opinion.

Here’s a breakdown of the pros and cons of this book in my perspective:

PROS:

• easy to read, direct; good flow to the book (he tells you his story, then gives examples how of you can do it, and then gives even more direct instructions of how you can change your financial status
• “inspiring” for people who are “sick and tired of the rat race”-  I think it’s safe to say he is probably good at public speaking, it makes you want to take action and at least attempt to get your finances in order
• he makes a good point- there should be more education on personal finance in schools
• he had an interesting life path that he justifies (e.g. working in the marines first, then as a pilot, then as a xerox salesman)

CONS:

• lots of talk about his boardgame and how you should buy it
• some of the stories that he mentions seem a bit too bizarro to be true (and apparantly he admits it)
• I feel bad that he dissed his biological “poor dad”, he also dissed a few other people in the book too- hope they don’t mind
• his emphasis on working for yourself… I think there can be a balance- you can work for as an employee and have other ways of generating income in your spare time
• he made buying foreclosures or real estate and generating income sound so simple and easy when it really isn’t

youngandthrifty’s rating from 0 to 10:

In terms of financial advice books, I would give it an 7.5 out of 10 because he is clear, has many stories/ examples that you can remember and try to apply to your own everyday life, and writes in a way that makes you want to follow his ideas and change your finances.  I didn’t like how some stories seemed exagerrated, or how he really made it sound like you don’t need postsecondary education at all to go anywhere in life, and how he mentioned his CASHFLOW board game numerous times.
Makes you wonder, if he’s so “rich” why is he resorting to selling CASHFLOW board games?  This (the book, board game, seminars) must be his main source of income now, NOT real estate and equity investments.  In it, he says he became financially free at the age of 47… you would wonder why it wasn’t sooner?

Have you read Rich Dad Poor Dad? What did you think of it?

Related posts:

1. youngandthrifty Book Review and Giveaway: Rich Dad’s Cash Flow Quadrant by Robert Kiyosaki
2. youngandthrifty Book Review and Giveaway: Smart Women Finish Rich by David Bach
3. Rich Dad Poor Dad Seminars a Scam?

Okay, so I’m entering the blogging world.  And am here to talk about money.  And saving.  And I am young.  Hence the title of my website “Young and Thrifty”… kinda like “the young and the restless”.  Catchy huh?  Thought you’d like that.

So, it seems like the average “Generation Y” guy or gal doesn’t know what an RRSP is.

Most of my friends tell me “it’s a mutual fund”.  So that’s why i am here.  To try and explain that it is not a mutual fund, but it can hold a mutual fund.  And explain much much more about that elusive and tangible thing, money (and how to save it)!

One of the other reasons I decided to make this website is that my sisters (er… they are 21 and 23 respectively, and yes, they are a bit sheltered), didn’t know the difference between a debit and credit card.

Yes, I know that is a bit extreme, but I plan to write about the very basics to the higher level in terms of saving, investing, etc. etc.  because we didn’t get taught about money in school.  And our parents (bless their baby boomer hearts) worked so hard so that we could live in excess and take everything for granted and not work a day in our lives and not know “what the value of a dollar” is.

Related posts:

1. How to Find a Good Financial Advisor
2. Last Minute “Blogging as a Business” Tax Tips