Summer Movie Time! Save Money at the Theatre!

Summer movies have officially arrived with the Wolverine movie last week. Today, Star Trek opens and coming soon are Angels & Demons, Terminator Salvation and the new Night at the Museum movie. I'm planning to see Star Trek today using a movie pass...I'll let you know what I think!

Will you be going to the theatre to see one or all of these? Do you cringe at the cost? $10+ for a movie, plus popcorn, candy and a drink.

Save some money! Little known is that you can get discount movie tickets that are good the FIRST day!! No waiting 2 weeks to see it with a pass.

Stop in at Hawthorne to pick up passes for your Summer movies!

$8 for Gold Passes (good the first day!)

or

$6.50 for Silver Passes (good after the 2nd weekend)

Join in the water cooler talk by seeing movies the first weekend without paying a huge price!!

TIP: Buy in bulk for the best prices

SAVINGS TIP: Buy your items in the largest size container available for the lowest cost per unit. The same holds true for cleaning products and dog food too. Plus, larger sizes use less packaging and are kinder to the earth.

Everyone is always touting the benefits of buying clubs like Costco and Sam's Club. But I've found that I end up blowing my whole grocery budget on big quantities of items and I miss certain things on my list. Then, of course, I end up with a few extra impulse items, too. I wonder if it really equates to savings. Maybe it does if you commit to only buying the things you normally would buy.

What do you think?

Is the Latte Effect Really The Problem?

Shopping malls and retail stores are always packed, and there is a new restaurant on every corner. Everyone seems to be wearing designer shoes, jackets and jeans and sipping $4 lattes. Credit card commercials are constantly promoting splurging and, U.S. consumers have been more than happy comply.

So what's the problem? Why do so many middle class Americans with so much stuff say they feel so squeezed? If they are consumed by debt, isn’t it their own fault? I have always thought that many times we are responsible for the financial situations that we find ourselves in. After doing some reading on the topic I now wonder if our personal needs and consumption choices are really the problem.

Bankruptcy law expert and Harvard University Professor Elizabeth Warren spent a lot of time crunching the consumer spending numbers for her popular books, "The Fragile Middle Class” and “The Two-Income Trap.” In both, she makes this point: Despite all those $200 sneakers you hear about and the long lines at Starbucks, consumers are actually spending less of their income — much less — on discretionary items like clothing, entertainment and food than their parents did. In fact, after taking care of essentials like housing and health care, today’s middle class has about half as much spending money as their parents did in the early 1970s, Warren says.

The basics, our life essentials, now take up close to three-fourths of every family's spending power (it was about 50 percent in 1973), leaving much less left over at the end of the month.
Even though household incomes have risen about 75 percent since 1970, most of that they say, is the result of a second earner, generally a woman, joining the work force. In many cases that added income has been swallowed by rising fixed expenses, such as child care and housing costs, because many people try and buy more house than they can actually afford. The average family now pays at least twice as much for housing compared to what our parents paid in the 1970s.

Four in 10 Americans don't have even one month's worth of savings for use in case of an emergency, according to a survey by HSBC Bank published in 2006. And even with two incomes built into the family budget, the odds of a household getting hit by a layoff have doubled in the last generation. The combination of high housing debt, rising health care costs, lack of savings and greater exposure to unemployment has left many families in a dangerous financial position.

I see the biggest problem being that the largest portion of our budgets are spent on fixed costs like housing, has risen much faster than wages and inflation. That means mortgages, more than lattes, are the source of many of our financial problems.

I now think that the "latte factor" is only being used as a way to distract people from the real changes in the economy.

What is the difference between being Cheap and being Frugal?

Everybody knows a cheap person and probably hates them. But I think we often mislabel frugal people as being cheap. I started thinking about this the other night after listening to a “lecture” from my dad about how to manage our phone service.

The topic came up because periodically during our phone conversation he was not able to hear me. I explained that we have had this problem several times since switching our phone service to Comcast, several months ago.

He went on to explain that they only use basic phone service with no additional features. Yes, that means no call waiting and no caller ID! He then went on to tell me that during the week they only call me and my brother using their cell phone minutes, and calls everyone else that he needs to talk to either at night or on the weekend from his cell phone, since those minutes are free.

Now this is a man who had money saved for his kids to go to college, lives in a beautiful home and drives nice cars, has no credit card debt and never makes us pay for dinner when he is in town, but he is worried about minimal charges on his phone bill.

My father is not cheap, he just enjoys saving money, when he can. Saving money and being cheap are two totally different concepts. So different that, well, maybe another couple examples will help.

I like to buy decent clothing. It’s not always cheap, but I like to make sure I buy it on sale. The more on sale an item is, the better I like it. In fact, if two dresses are on sale, I can buy two good dresses instead of one expensive one. Does that qualify as being cheap?

I just have a hard time buying things at regular price when in a few weeks it will be on sale (which is the price it should’ve been in the first place, in my opinion).

Here’s another example…

Let’s say you need to put gas in your car and on the way to going somewhere you were going anyway you pass two gas stations right next to one another. Gas is $3.45 a gallon at one and at least $3.55 a gallon at the other.

All other factors being equal, you’d have to be a total idiot not to buy the$3.45 a gallon gas…
That’s managing your money well.

On the other hand…

To kill a half an hour of your time driving clear across town, way out of your way, just to “save” a buck or two would be “being cheap”.

Yes, that would be me sometimes! I hate to admit this, but I have driven to Costco for gas, which is a good 20 minutes from our house.

Although there is sometimes a fine line between the two, there’s a distinct difference between “being cheap” and managing your money well and it is important for us to know and understand the difference between the two.

Knowing and understanding this difference and applying this principle to our lives can make the difference between us having money or being poor.

Where does all of our money go?

This weekend, I did it again. I went shopping and spent too much money. I did not buy anything big, just all of the things that my family and I need.

Looking at the total on the bottom of my receipt, made me stop and think. What is really necessary? We slowly get used to more & more stuff, and before we know it, it is hard to tell the difference between our needs and our wants.

Instead of buying Suave shampoo (on sale for .99) like I used to, I now buy a more expensive shampoo that cost about $3.50. Is that cost increase really necessary? All of my little cost increases can really add up, and my hair does not even look or feel any better than it did before. Although this represents a very small piece of my financial puzzle, I wonder why many of us spend extra money, when we don’t really need to.

Money is a powerful resource. We strive to acquire it and we are told we cannot survive without it. It represents glamour, prestige, power, security and happiness and no matter how non-materialistic we may strive (or claim) to be, in the end, much of our life revolves around making money and spending it. And, we certainly spend tremendous mental and emotional energy thinking about it.

What is the difference between or needs and wants?
Our actual needs are pretty limited: food, shelter and clothing. Just about everything else is a "want," and our wants are essentially endless. Almost all of us have limited resources, so we have to make choices about which wants to fulfill.

The way we fulfill our needs also involves a lot of choice. Shelter, for example, can be a bed at a homeless shelter, an apartment, or a $1 million home. Our food choices offer similar extremes, from beans and tap water eaten at home to steak and Dom Perignon at an exclusive restaurant.

I think that many people believe they have to spend money in certain ways or in certain amounts, when in reality their spending is a choice -- or is at least based on choices that have been made in the past. For example, if you have a huge mortgage payment, it's because you chose to buy a big home and select a particular mortgage.

A hard, cold look at how and where we spend our money can show us – often in a painfully clear light – why we may experience financial difficulties from time to time. This, of course, is one of the main reasons that so many people resist examining their monetary habits and belief systems in the first place.

For more information on learning how to properly budget your money, take a look at our free Balance Fitness Program.

Balance will help you develop a workable spending and savings plan, we want to help. That's why we've provided access to free and confidential financial counseling and education through BALANCE.