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Yesterday, I mentioned that because I grew up poor, I inherited a faulty money blueprint from my parents. They didn’t know how to handle money effectively, so they couldn’t teach me how to handle it effectively. I entered adulthood with many of the same bad habits they’d had when I was a kid.

I was a compulsive spender, for instance. I had a shopping addiction. I had no willpower, no impulse control. Even when I had no money in the bank, I still found ways to spend. I took on over $20,000 in credit card debt before I turned 25!

Nowadays, I mostly have my spending under control. I’m no longer in debt, and I force myself to make conscious decisions about what I purchase. (Conscious spending is one of the keys to overcoming emotional spending.)

Having said that, I know that if I relax for even a moment, I’ll be right back in my old habits. I’ll find myself at the grocery store buying magazines to soothe a bruised ego, or shopping for music in the iTunes store because I had a stressful day.

How do I know I’ll relapse if I’m not careful? Because I do from time to time. When I was prepping for my big talk at the end of June, for example, I felt super stressed and my shopping addiction kicked in. I spent an afternoon browsing on...

By now, you’ve probably heard of the famous Stanford marshmallow experiment. Most folks are familiar with this fifty-year-old study and its conclusions. In case this is the first you’ve learned of it, however, I’ll give a quick review.

During the late 1960s, psychologist Walter Mischel tested the willpower of young children (roughly four years old). A researcher would bring the children — one at a time — into a room where they had access to a selection of treats, including marshmallows. The children were told that they could eat have one treat right away or, if they waited fifteen minutes, they could have two. Then the researcher left the room.

While this study gave researchers an immediate glimpse at how children handle delayed gratification, it also yielded some interest long-term results. In 1990, Mischel (and colleagues) reconnected with some of the kids from the marshmallow test to see how life had turned out for them.

This second study revealed that the children with the best self-discipline at four years old grew up to be more popular, more successful in school, and better able to handle stress. The kids with patience and willpower were less likely to turn to drugs and they were more physically fit. In short, the ability to wait fifteen minutes to earn an extra marshmallow as a preschooler seemed to be an excellent predictor of how well a child would be able to delay short-term gratification later in life in...

This is a guest post from Travis Hornsby, founder of Student Loan Planner. I met Travis last year and realized he knows a lot about something that’s a bling spot for me. I asked him if he’d be willing to whip up an article for GRS readers about refinancing student loans. Here it is!

How would you like spending $4000 each you and have nothing to show for it? Sounds crazy, right? Yet that’s exactly what happens when you find yourself buried in debt — whether it’s credit-card debt or student loans.

Let me give you an example.

I had a friend who owed about $200,000 of student debt. He was paying everything back on the standard ten-year plan with the federal government.

He knew there were other lenders out there that would allow him to refinance to a lower interest rate, but he wasn’t sure there would be much of a benefit. After I convinced him to explore his options, however, he locked in a rate of 5% instead of 7%. In other words, he cut his annual interest costs by more than $4000.

What could you do with an extra $4000 per year?

Another buddy of mine got a letter in the mail from a major bank that convinced him to refinance his federal loans to a 4.8% variable rate. Not bad. But since he didn’t shop around, he didn’t realize he could have found a much lower rate! After some research, he went with another lender that gave him a...

I am both a money nerd and a book nerd. Naturally, I get a little giddy when I find old books about money I’ve never heard of before.

While browsing Oregon’s best used bookstore earlier this year, I stumbled on a 1989 book called How to Retire Young by Edward M. Tauber. Tauber retired at the age of 43 from a tenured full professorship as Professor of Marketing at the University of Southern California. He’s written a number of marketing textbooks, but this was his first (and only?) foray into the realm of personal finance.

How to Retire Young is one of the oldest books I’ve found on the subject of early retirement. It’s fun to see how much of the modern financial indepence movement is foreshadowed in the book’s pages.

It’s also fun to see how closely How to Retire Young adheres to my own “get rich slowly” philosophy. “Much [financial advice] is oriented toward the quick buck,” writes Tauber, “taking paths that often have a low probability. In short, you might as well play the lottery.”

Tauber has a different philosophy. He urges readers to “take the high road”. He wants them to follow the path with the greatest odds of success, even if that path might not lead to quick wins. He also cautions that “there’s no best way for everyone”, just as I say “

The world of blogging has changed since I started Get Rich Slowly in April 2006. For one thing, “blogging” now encompasses other media. Some folks prefer to get their info via podcasts or video. (Me? I’m a reader.)

As an experiment — and to prove I’m not that old — I’m going to try a series of four weekly Facebook Live discussions. For the next four Saturdays, Kim and I are going to have a Saturday morning conversation about personal finance in front of dozens (hundreds?) of other folks.

That’s right: My girlfriend is going to join me for this project.

After a lot of discussion about what format would work best, I realized that Kim’s voice would be a welcome addition to these videos. For one, she’s nicer to look at and has a more engaging personality. For another, she’s not as far along the path to financial freedom as I am. In fact, she has some very real concerns about whether or not she’ll be able to save enough for retirement by the time she wants to retire!

Adding Kim to the mix will make these conversations more interesting (we can interview each other) and allow viewers to get more than one point of view.

For now, we’re only planning to do four of these. If people like them — and they’re not too difficult — we’ll make this a regular feature. (And, in the meantime,...

Last week via email, reader David Hatch asked:

If you were going to buy a new car, what would you get do you think?

I wrote a short email reply…then decide this topic is worth a deeper dive (of only for my own personal edification).

You see, Kim and I have been talking about cars lately. Mine is fifteen years old and hers is over twenty. Although both are running fine, we realize that we’ll have to replace one (or both) of them in the near future. When we do, what will we buy? What kind of new car is right for Kim? What kind of car is right for me?

Let’s start by looking at the cars I’ve owned in the past.

Every Car I’ve Ever Owned

I am not a car guy. Even though I can appreciate nice cars, I don’t have any desire to own them. I’m not sure why. Maybe it’s because my parents never had nice cars when I was a kid. They had practical, serviceable vehicles that got the job done.

During my 33 years of driving, I’ve owned five cars.

In high school, I inherited my father’s 1980 Datsun 310 GX. I drove that little red beast until it died during my senior year of college. I had a lot of fun with the Datsun, but I treated it poorly. The best part about this car was that I could perform a lot of the maintenance myself — even though I don’t have much mechanical knowledge. (Driven from March 1985...

I’m generally a pretty laid-back guy but, like anyone, I do have pet peeves. Because I write about money, I have lots of trivial personal-finance pet peeves. (It’s “saving rate“, not “savings rate”. Dave Ramsey did not invent the debt snowball, and his version is but one kind of debt snowball. It’s not the only debt snowball. See? I told you these pet peeves were trivial!)

It’s silly that I’m bugged by this stuff, but I am. I’m sure you have pet peeves too, especially when it comes to your work.

One of my top pet peeves in the world of personal finance is when people who should know better conflate income and wealth. A high income can lead to great wealth — although it doesn’t always — but they’re not the same thing.

I see this error frequently — even in high-profile articles at major media outlets.

This morning, for example, I read an article at Vox about income inequality in Europe and the United States. The piece opens like this:

Income inequality is a growing problem in the United States. The richest Americans have reaped a disproportional amount of economic growth while worker wages have failed to keep pace.

The author elaborates: “From 1980 to 2016, the poorest half of the US population has seen its share of income steadily decline, and the top 1 percent have grabbed more.”

What bugs me here are the logical leaps from “low income” to “poor” and from “high income” to “rich”. But I can’t...

I’m not the only semi-celebrity J.D. Roth. For more than fifteen years, I’ve been receiving email and tweets and Facebook messages intended for the other JD Roth, the former executive producer of The Biggest Loser — and tons of other television shows.

Apparently the other JD Roth has a lot of fans. Actually, I’m one of them. I’ve been watching his shows since 2009, when season seven of The Biggest Loser inspired me to start my own weight-loss journey. When he published his book The Big Fat Truth in the spring of 2016, I read it the day it was released. I thought it was great, and wished that I could interview the author, but Kim and I were in the middle of our 15-month RV trip across the U.S. and I couldn’t make the logistics work.

In 2017, when I learned that Roth had created a TV version of The Big Fat Truth, I knew the time had come at last: J.D. Roth was going to interview JD Roth. Last August, we made it happen. (I originally published this interview at Money Boss a year ago; today, I’m moving it to Get Rich Slowly.)

Note: It can be tough to tell the two of us apart. We’re both 5’8″. We both have the same facial hair. We both have beautiful wives/girlfriends. And we both share similar underlying philosophies regarding success and personal development.

That said, there are some subtle differences between the two of us.

  • I spell my name J.D....

This morning, for the first time in more than eight years, I weighed in at 200 pounds.

I am not proud of this fact but it’s the truth. I own it. I got to this point through my own actions, not because some cruel tormenter force-fed me cheeseburgers and beer.

When I’m overweight, I tend to internalize the problem, which generally leads to a vicious cycle of overeating, shame, and self-loathing. While I’m older now and more aware of my mental processes, I still struggle with self-defeating thought and behavior. (This is exacerbated, of course, by my recent battle with depression. In fact, I suspect the depression has a hand in my life-long weight issues. The onset of both seem to be correlated.)

Being fat affects my self-confidence and self-esteem. I’m less likely to be social. When I do go out and see people, I’m less engaging (and I know it). Right now, my weight is actually hindering my work too. In April, I started a Get Rich Slowly channel on YouTube. My goal is to produce a couple of videos per month — but I’m not willing to put myself on camera at the moment.

In short: Like many people, I allow my physical make-up to dictate my mental make-up.

People are funny like that. We internalize stuff that ought not to be internalized. When we do, it becomes much more difficult to do the right thing, to make the changes that need to be made.

Take money, for instance.

Net Worth Is NOT...

Over the past three months, I’ve written a lot about buying and owning a home. Much of what I’ve written could be construed as anti-homeownership. Hear are some of the articles I’ve published recently:

Last week, a GRS reader named Carmine left this comment:

I appreciate this and other recent posts on the perils and difficulties of home ownership, but they’re sort of piling up into a major downer as I read them!…Can’t you write something talking about the payoffs that home ownership can bring?

Challenge accepted!

I can understand how Carmine might view all of this as a downer. And I can see how anyone might think I’m anti-homeownership. But here’s the thing: I’m not. After all, I own my home, and I like it.

Today, let’s take a look at some of the advantages of homeownership.

Your Home Is a Store of Value

A home is an excellent store of value. Home prices are less volatile than stock prices, so you take on less risk when you put money toward your mortgage than when you buy mutual funds. Plus, your home’s value is generally going keep pace with inflation.

My ex-wife and I bought our first home in 1993 for $112,000; we sold it eleven years...

I’ll admit it: There are times that I think everything that needs to be said about personal finance has been said already, that all of the information is out there just waiting for people to find it. The problem is solved.

Perhaps this is technically true, but now and then — as this morning — I’m reminded that teaching people about money is a never-ending process. There aren’t a lot of new topics to write about, that’s true (this is something that even famous professional financial journalists grouse about in private), but there are tons of new people to reach, people who have never been exposed to these ideas. And, more importantly, there’s a constant stream of new misinformation polluting the pool of smart advice. (Sometimes this misinformation is well-meaning; sometimes it’s not.)

Here’s an example. This morning, I read a piece at Slate by Felix Salmon called “The Millionaire’s Mortgage”. Salmon’s argument is simple: “Paying off your house is saving for retirement.”

Now, I don’t necessarily disagree with this basic premise. I too believe that money you pay toward your mortgage principle is, in effect, money you’ve saved, just as if you’d put it in the bank or invested in a mutual fund. Many financial advisers say the same thing: Money you put toward debt reduction is the same as money you’ve invested. (Obviously, they’re not exactly the same but they’re close enough.)

So, yes, paying off your home is saving for retirement. Or, more precisely, it’s building your net...

I read a lot of books. Nearly every book has some nugget of wisdom I can take from it, but it’s rare indeed when I read a book and feel like I’ve hit the mother lode. In 2018, I’ve been fortunate enough to read two books that I’ll be mining for years to come.

The first was Sapiens, the 2015 “brief history of mankind” from Yuval Noah Harari. I finished the second book yesterday: Thinking in Bets by Annie Duke. Duke is a professional poker player; Thinking in Bets is her attempt to take lessons from the world of poker and apply them to making smarter decisions in all aspects of life.

“Thinking in bets starts with recognizing that there are exactly two things that determine how our lives turn out,” Duke writes in the book’s introduction. Those two things? The quality of our decisions and luck. “Learning to recognize the difference between the two is what thinking in bets is all about.”

We have complete control over the quality of our decisions but we have little (or no) control over luck.

The Quality of Our Decisions

The first (and greatest) variable in how our lives turn out is the quality of our decisions.

People have a natural tendency to conflate the quality of a decision with the quality of its outcome. They’re not the same thing. You can make a smart, rational choice but still get poor results. That doesn’t mean you should have made a different choice; it simply...

Yesterday at the Financial Careers forum on Reddit, a user named /u/unfoldcareers posted some useful advice for job-seekers. “I’ve reviewed and screened thousands of resumes,” /u/unfoldcareers writes, “and I’m sharing my preferred resume format…along with my best resume advice.”

The poster notes that “bad resume format” leads most folks to get little or nor response to their job applications. To help current job hunters, /u/unfoldcareers created a free resume template that can be downloaded via Google Docs.

The Reddit post itself contains a number of useful tips. To craft a better resume, you should:

  • Be precise. Don’t speak in general terms, but include specific numbers and metrics. Instead of saying, “Was top salesperson at my company,” note how many people were on the sales team, how much better you performed than everybody else, and for how long.
  • Emphasize impact. According to /u/unfoldcareers, too many people focus on their achievements when they should really emphasize the impact they had on their company or team.
  • Stick to one page — unless you really do have decades of experience.
  • Make it scannable. “A hiring manager will review your resume for approximately 10 seconds or less,” writes /u/unfoldcareers. Be sure that they’ll be able to scan all of the important info quickly.
  • Explain gaps. Don’t leave a mystery. If you took time off to be a stay-at-home parent, say so.
  • Remove the “objective” line. It’s irrelevant. (I did a very little hiring for our family’s box...

The July 2018 issue of the AAII Journal — the monthly publication of the American Association of Individual Investors — includes an intersting article about how to “increase your retirement resources”. This plain English piece summarizes some of the findings from the authors’ research paper “The Power of Working Longer“.

According to the article, there are three primary factors that determine “the adequacy of retirement resources”. Those are:

  • When a person begins participating in an employer-sponsored saving plan,
  • What percentage of their earnings they save in such a plan (i.e., their saving rate), and
  • At what age they retire and begin taking Social Security benefits.

Until Elon Musk invents a time submarine, it’s impossible for a worker to go back to their youth and begin saving for retirement earlier. Because of this, the authors focused their research on the relative power of saving more and working longer.

Note: To simplify matters, the authors make some assumptions. For instance, instead of investing in the highly-variable stock market, they assume their hypothetical subjects invest in a vehicle with a fixed rate of return: an annuity. This is a little goofy, but helps them come up with more precise numbers than they’d otherwise be able to achieve. Just keep this in mind as we talk about the article’s conclusions.

The Power of Working Longer

First, the authors look at what happens when a person decides to delay retirement by a year — or more. Generally speaking, each extra year worked brings roughly a 7.5% increase...

Last week, Ben Carlson from A Wealth of Common Sense published an interesting article about how staying rich is harder than getting rich. He writes:

Research shows over 50% of Americans will find themselves in the top 10% of earners for at least one year of their lives. More than 11% will find themselves in the top 1% of income-earners at some point. And close to 99% of those who make it into the top 1% of earners will find themselves on the outside looking in within a decade.

It’s great that so many people get to taste what it’s like to earn a lot of money, if only for a little while. What’s not so great is that as most people earn more, they spend more. But if you spend all (or most) of what you earn as you’re surfing an income bubble, you can find yourself in trouble when that bubble bursts.

Carlson quotes a story about a couple that lived a lavish lifestyle because they were making a lot of money. When the income dried up, they realized they had nothing left. They were broke. Says the husband: “The money was just coming so fast and so easy that my ego led me to believe that, ‘Oh, this is my life forever.'”

I’ve been thinking about that last line for a week now: “This is my life forever.” This couple fell for a common (but seldom examined) mental trap: the forever fallacy. The forever fallacy is the mistaken...

Over the next few weeks at Get Rich Slowly, I plan to ramp up the production level once again. I’m not going to return to the pace of one article per day that I was maintaining at the start of the year, but I’m not going to rest at two articles per week like I did in June, either. I’m guessing we’ll end up at three to four articles per week.

To start, here’s some raw video from Miami Beach, Florida in which three men work together to distract a convenience store clerk in order to install a card skimmer at a point-of-purchase card reader.

This is interesting to me because I’ve never understood how these things work. I don’t know how to spot card skimmers, and I don’t know how crooks install them.

Well, apparently it takes like two seconds for them to install the device — and they look (superficially, at least) exactly like the regular card readers. That sucks. I don’t know how to avoid a skimmer, and I don’t know what to tell you in order to make sure that you’re safe.

Here are two articles about card skimmers (and how to protect yourself):

Card skimming is relatively uncommon but it does happen. Your best bet — as it is in many situations like this — is to check your bank accounts regularly to be sure there’s no suspicious activity.


Every Tuesday and Thursday morning for the past four weeks, I’ve awakened early and driven to the gym for a one-hour workout with a personal trainer. This is awesome but it also sucks.

Why does it suck? Because:

  • I am old.
  • I am fat.
  • I am out of shape.

Plus, who likes getting up at five o’clock? Not me! I can handle 6:30 no problem (and left to my own devices, that’s when I’ll naturally rise) but crawling out of bed ninety minutes earlier destroys me.

At the same time, this change has been awesome. Eight years ago, when I was at the heaviest weight of my life, I forced myself to get up early and go to the local Crossfit gym. After two years, I’d left peak fatness behind and achieved peak fitness. I was in the best shape of my life! Now I have a long way to before I get back to that point, but the key is that I’ve started.

Aside from improving my physical fitness (I’ve noticed positive changes already), this move has improved my mental fitness. Honestly, that’s actually what prompted me to get back to the gym. After admitting to myself that my depression was messing up my life, I resolved to make changes.

At first, I wanted some magic instant cure for the depression. There isn’t one. As with most things in life, there are no shortcuts to solving mental illness. (Perhaps a pill might be considered a shortcut, but pills come with side effects.) To get better,...

Two years ago today, Kim and I returned to Portland after fifteen months traveling the United States in an RV. Believe it or not, I’ve never published an article about the trip and how much it cost. Although we kept a travel blog for most of the adventure (including a page that documented are expenses), I’ve never gathered everything into one place. Until now.

Today, I want to share just how much we spent on the journey — and some of our favorite stops along the way. It seems like the perfect post to celebrate the start of summer, don’t you think?

The Lure of Adventure

All my life, I’ve wanted to take a roadtrip across the United States.

When I was young, I was lured by the adventure. I wanted to climb mountains, swim rivers, and explore canyons. The older I got, the more fascinated I became by the country’s regional differences. The U.S. is huge, a fact that most foreign visitors forget. Most American citizens don’t even realize how big the country is. I wanted to see and experience it all.

Although I’ve dreamed of a cross-country roadtrip, it’s never been practical. As a boy, my family was poor. My parents didn’t have money for something like this. As a young adult, I couldn’t afford it either. For a long time, I was deep in debt....

“When are you going to write about your hot tub?” readers have been asking. “We want photos of you in your hot tub.” Fine. Here’s a typical scene on any given afternoon. (This photo was taken with my iPad, and I can’t figure out where the camera lens is…)

The cats like the hot tub too, but only when the lid is closed. I suspect they’ll live on top of this thing during the winter.

You folks were 100% correct when you encouraged me to proceed with this purchase. I was anxious after having spent so much on remodeling the house during the first few months after we moved in. I didn’t want to spend more. But you guys encouraged me to throw in one fun thing along with all of the needed repairs. It was the right move.

A Money Nerd and His Hot Tub Spreadsheet

We’ve had the hot tub for a month now, and I’m pleased to report that we’re using the hell out of it. (Rumor has it than many people who purchase a spa don’t use as much as they think they will.) Because I’m a money nerd, every time I use the thing, I document my stats in a spreadsheet.

“What in the world are you doing?” Kim asked the first time...

When I was a younger man — back before I founded Get Rich Slowly in 2006 — I was intrigued by the idea of creating passive income. While passive income isn’t exactly a get rich quick scheme (and boy was I intrigued boy those back then!), there’s certainly some overlap. Both passive income and get rich quick schemes appeal to lazy people like my younger self, people looking for ways to make money for nothing.

What Is Passive Income?

Passive income, as the term implies, is money you earn on a regular basis with little or no effort required to maintain the cash flow after the income stream has begun.

Common examples of passive income include rental properties, royalties from books (and other published work), and profitable businesses that you own but in which you have little (or no) active involvement.

My interest in passive income started early in life. When I was a boy, my father was drawn to the promise of easy money. (See? This is another example of how we inherit our money blueprints from our parents.) Dad was a serial entrepreneur, as I’ve mentioned before, but he was also drawn to multi-level marketing schemes.

Multi-level marketing schemes lure victims participants with the dream of big bucks for minimal effort. Sure, you have to set up your own operation by recruiting customers and a stable of salespeople, but once you do...