Effort to cultivate good relationships has rich rewards.

For seven years, I’ve been meeting once a month with the same group of women. We share a meal, play a game, and catch up on what’s been happening in our lives. It’s a diverse group of women of varying ages and economic means. Some have grown grandchildren, and some, like me, are raising young families. Some are retired, and others are still building careers. What we all have in common, though, is a desire to carve out time for this community of friends. Even when I have to juggle childcare and handle the duties of hosting the group myself, I always end up feeling rejuvenated by the end of the evening.
Scientists in the field of positive psychology are digging up hard data that confirms a being part of community is an important element in finding happiness. One study concluded that being part of a group of friends that meets once a month has the same psychological effect as doubling your income.

It’s hard to imagine exactly how I’d feel if I doubled my income. But I do know that meeting with this group of women makes me happy. According to University of California psychologist Sonja Lyubomirsky, 40 percent of our happiness is a result of making intentional choices, like choosing to be part of a community such as the one I describe. On the other hand, just 10 percent of happiness is connected to life circumstances, says Lyubomirsky.

Happiness isn’t the only benefit of community, however. Being an active part of a community has practical rewards. I recently had the pleasure of connecting with a fellow gardener I’d never met before. I spent a lovely afternoon learning about new plant varieties and seeing how to create a beautiful, low-maintenance garden design. I gained practical knowledge, a new friend, and eight boxes of transplants that would have cost me hundreds of dollars at a nursery. I happily spent an evening planting all my newfound greenery, and my beds will fill in with a wealth of new young trees, shrubs and flowers.

Community not only makes our gardens more beautiful, but can make our lives easier, too. For example, in our development, we have a neighbor who has been plowing our driveway for the last several years. He’s also used his auger to drill holes for a fence we made from reclaimed cedar that we got from another neighbor. Fortunately for me, both of these neighbors have an extraordinary fondness for homemade banana bread. I bake for them in exchange for the assistance and materials they give us. The relationships we’ve developed have been a tremendous help to us – and saved us money - in many circumstances.

Building relationships takes effort, particularly in a culture where we rely on one-line updates and text messages to communicate with one another. But taking the time to be part of a community, to invest in one another, makes good sense. It requires making choices about how and with whom you spend your time, but the effort to cultivate good relationships has rich rewards. Money is essential for paying the bills, but it can’t buy the emotional support, sense of camaraderie and practical, budget-stretching help of a close friend or good neighbor.

Complaining with purpose makes good financial sense

Our 5-year-old is funny and bright, generous and compassionate, but she also tends to be a complainer. Her socks are too loose. Her hangnail is keeping her awake. She doesn’t want to eat a sandwich for lunch two days in a row.

As her parents, we want to teach her that if she is going to complain, she should do so with purpose. We often remind her that she will get the best results when she can clearly explain the problem and suggest a solution. It sounds simple, but it takes hard work and consistency to parent this way.

Complaining with purpose isn’t always easy in my own life, either. Sometimes, this is because I’m complacent, or I don’t want to take the time to do it. Or maybe I just don’t feel like rocking the proverbial boat. The fact is, though, that complaining with purpose often makes good financial sense.

Recently, when a handle broke on a nearly-new enamel teapot, I e-mailed the company to explain the situation and ask for a replacement part. Within a day of my inquiry, I got a response from the customer service department informing me that the company did not have handle replacements. Nevertheless, if I would provide proof of purchase, the company would replace my teapot at no cost to me.

This experience taught me I shouldn’t assume I’m stuck when a product doesn’t live up to my expectations. I didn’t have to invest very much time, and I ended up getting a brand new tea kettle that would have cost $30 in a retail store.

Of course, these types of situations don’t always end so easily or favorably. When my computer started browsing painfully slowly, I contacted my Internet service provider to troubleshoot the problem. I spent hours on the phone running speed tests and adjusting settings, only to get routed to advanced technical support, where I was instructed to run still more tests.

This went on for weeks. Eventually, technical support services determined that I needed a new router, which would arrive in three to five business days. When it didn’t arrive as promised, I called the company again, only to be told that the router I needed was on back order. The representative assured me that the company would ship the router as soon as it was available.

At this point, I’d grown so frustrated that I reluctantly asked to speak to a supervisor. I recounted my story and asked the supervisor to credit me one month of service and to overnight a router as soon as it was available. After reviewing my account, he agreed to call me every two days until the situation was resolved. He called me when he said he would, and the modem arrived within three days of our conversation.

Complaining with purpose, especially when done with tact, helps you get results and can save you money. If you have a problem, take the time to contact the company and explain the issue in as much detail as possible. Suggest specific ways the company can fix the problem, but be willing to accept an alternative, too.

You won’t always find a perfect resolution to your problem, and you will need to decide how much time a situation warrants. It may not be worth your time to complain about a sleeve of mini donuts (It was to my husband, who got a coupon in the mail for another sleeve of said mini donuts), but getting a broken appliance fixed or a part replaced can leave you with much-needed extra cash in your wallet. And that’s something you won’t complain about.

CCCS/ACCE –American Center for Credit Education
Carey Denman

The joy of infinite possibilities

The most coveted toy in our playroom right now isn’t even a toy. A sturdy 12- by 20-inch box has become a treasure chest, car ramp, boat, bathtub, baby cradle, hat, launch pad, slide, bridge, and stepstool, among many other things.

My children probably couldn’t tell you why they like the box as much as they do, but I can. A box is boundless, a plaything with infinite possibilities. It does what their imaginations want it to do. When they tire of playing pirates adrift in the high seas, they can stage a manger scene, complete with animals and shepherds. Later, they can flip it over and make it into a roof for their fort or put on a puppet show with it.

On the other hand, a toy fire engine in their playroom is finite. Though it is shiny red, has a realistic-sounding siren and flashing lights, and even a ladder, it has never been anything more than a truck. And most often, it sits on the shelf untouched, along with other similar toys.

Instead of toys, our children tend to gravitate toward materials, such as a hamper stuffed full of dress-up clothes. They pull out silly secondhand hats and ties, tutus and wings, wands and thrift-store capes, and dresses and robes. In the process, they become knights and princesses, dancers and dragons, circus performers and teachers.

Choosing materials over toys allows us and our children to do more with less. Materials are simpler and typically less expensive than traditional toys, and our children innately know what to do with them. With materials on hand, our kids aren’t camped out in front of the television or the computer. And perhaps best of all, materials are a boon for all parents who dread the perennial cry of “I’m bored.”

The best place to find materials for play is in your own home. I recently dumped out a $1 bag of dried kidney beans on the counter and handed my children bowls and small spoons and shovels. They played together (without fighting, oh wonder of wonders) for almost two hours—counting, sorting, pushing, and pouring those beans. I’ve also given my children buckets of water and paintbrushes so they could “paint” the back patio on a sunny afternoon. Sidewalk chalk, homemade bubbles, salt dough and a bag full of cookie cutters cost virtually nothing but make for hours of fun.

When we do buy materials, we choose them carefully. We keep a stack of paper on hand at all times and have invested in good-quality art supplies. We’ve asked for wooden blocks and train tracks for gifts and pick them up at rummage sales whenever we see them. Sturdy child-size rakes and trowels are perfect for working alongside us in the garden—and digging for worms.

The lesson of creatively doing more with less is good for adults, too. Take that bag of kidney beans, spend a few minutes looking for a recipe online, and you can come up with an affordable meal for your family. Rearrange your furniture–or simply move art, photos and plants from one room to another–and you’ll feel like you have a fresh new space. Go through your closet to create new outfits, or dress up your wardrobe with an inexpensive accessory like a new scarf.

When you take a fresh look at the materials around your house, you’ll find a world of possibilities for your children and yourself that stretch your imagination, not your wallet.

CCCS/ACCE –American Center for Credit Education
Carey Denman

Habits are Key to Managing Money

I don’t consider myself a math whiz. After all, I’ve been known to look up the rules for adding and subtracting fractions, and I still get weak in the knees when I have to do ”public math.” I suppose you could find this a little ironic, considering I write about personal finances for a living.

I contend, though, that managing your money well has more to do with controlling your habits and emotions than it does with crunching numbers. After you understand general computation, the math of financial success is simple: Spend less than you earn. What isn’t so simple is living with a perspective that can help you do this.

Money perspectives are often so subtly-woven into your life that it can be difficult to recognize them. It’s like the old adage: The thing a fish is least likely to notice is the water in which it swims. To begin understanding your perspectives, you have to look closely.

You can do this by examining how you spend your money right now. Start by making two columns on a piece of paper. In the first column, list things you would really like to spend your money on. This might include a vacation, a college fund, charitable cause, new television, pair of water skis or garden fence, for example. Don’t count anything as too grand or insignificant.

After you’re satisfied with your list, get out your checkbook register or go to your online banking site and make a list in the other column that includes every place you spent money last month. If necessary, get out your credit card statements, too, so you can include individual purchases or expenses on your list. When you’re finished with both lists, compare them.

Are you spending in a way that is helping you get things you want? If there’s a disparity between your lists, ask yourself why. It may be owing to habits that go unchecked, such as eating out. But you may need to challenge what you would consider the most basic expenses – housing, food and transportation. It’s possible that your habits and perspectives have more influence than you realize.

Not long ago, my husband believed it was natural to have a car payment. His parents always had a car payment when he was growing up, so why wouldn’t he? It never occurred to him there was another option. It’s not wrong to have a car payment, of course, but you should consider why you have one in the first place. You may find that it goes deeper than your need for transportation.

What and where you eat says something about your perspectives, too. I once had a friend announce that she didn’t eat “cheap food.” I think she was referring to packaged foods, such as instant noodles and macaroni and cheese, but her statement seemed to apply more to her ideas about the meaning of food than to issues of nutrition.

You have to eat, but you have a significant amount of control over how much you spend on food. You need shelter, but you don’t have to own a home or live in a certain neighborhood. If living with a roommate or selling your house would improve the quality of your life, why not consider it?

Realize you shouldn’t allow a limited perspective to keep you from getting what you most desire.

CCCS/ACCE –American Center for Credit Education
Carey Denman

Buy What You Need, Not to Impress

My first car was a baby blue 1980 Chevette. Starting the car involved using a manual choke and feathering the gas pedal. It was prone to stalling out at stoplights and couldn’t climb hills when the air conditioning was on. A blanket covered the rotted back seat that flopped forward with sudden stops. That car was the antithesis of cool.

Having to feather the gas pedal in the school parking lot is never hip. But my fourteen-year-old mind reasoned that having a car phone might be. That’s probably why I used the points I earned selling products for the Spanish Club to buy what looked like an authentic car phone. I don’t know what I expected, but I was disappointed when the phone arrived and looked like a child’s toy.

It’s laughably incongruent, and a little embarrassing, that I imagined a fake car phone was my ticket to coolness. Nevertheless, reflecting on this story makes me think about the problem of trying to present a certain image of ourselves, when the reality is altogether different. The stakes in real life are much higher, though.

There’s a name for this kind of behavior; it’s known as compensatory consumption. Compensatory consumption is defined as an attempt to offset deficiencies or a lack of self-esteem by spending money, often on so-called status symbols. Research suggests that people are most likely to engage in compensatory consumption when they experience a feeling of powerlessness. This feeling could be a result of getting passed up for a promotion at work or struggling to make friends, for example.

Whatever the reason for the behavior, compensatory consumption often ends up as an attempt to buoy your image among peers. Perhaps it’s taking a trip you can’t afford because you don’t want to disappoint the friends who have invited you. Or maybe you offer to pick up the lunch tab, even when it will bust your budget. Buying a pricy gift or throwing a lavish party—because you don’t want to appear cheap—fit into this category too.

Scrambling to pay your monthly bills may be a short-term consequence of compensatory consumption. In the long-term, you could end up getting stuck with payments that you can’t afford to make. Maybe most significantly, making decisions based on how others perceive you can chip away at your overall economic well-being. It can also keep you from reaching your personal financial goals.

The best way to avoid the trap of conspicuous consumption is to know what you want. Your goals, not marketing messages or pressure from those around you, should be the roadmap you follow.

CCCS/ACCE –American Center for Credit Education
Carey Denman