What Does Machine Learning Have to Do with SEO?


If you believe most popular representations, artificial intelligence is scary. We see it take over the world in Terminator. It murders its creator and escapes in Ex Machina and it just goes insane in 2001: A Space Odessy.

We’ve been taught our whole lives to fear the singularity. But we’re barging ahead with AI development anyways.

And it’s invading our everyday lives. Even our cell phones will have artificial intelligence chips soon.

But one area you would never expect AI to touch: SEO. But it’s happening. And Google’s machine learning algorithm is changing the way we do SEO. Let’s take a look.

1. Machine Learning vs. Artificial Intelligence

The idea of artificial intelligence has been around for a long time. The man who built the first full-sized computer created the most ubiquitous test for determining how human-like AI really is. If it passes the Turing test, it’s fooled a human into thinking it’s human.

Contemporary chatbots are able to pass the Turing test. That’s how far we’ve come.

When Turing imagined machines that could mimic humans, AI was just a dream. No machine was complicated enough to fool a human.

But computers have advanced lightyears compared to Turing’s first machine. And now we have machines that can learn. Eventually, we will no longer program computers, but train them like animals or children.

This sub-genre of AI is called “machine learning.”

The Science and The Algorithm

To understand the difference between AI and Machine Learning, you have to understand what AI actually is.

Artificial intelligence is the science of making machines intelligent. Machine learning is the way we implement that science. It’s the algorithms that allow the machine to learn and retain knowledge.

Basic machine learning won’t fool a human in the Turing test, but complicated machine learning algorithms will. This means that machine learning is being used in places you wouldn’t know.

Anything connected to the internet of things will use machine learning, your online banking, your smartphone, etc. It all uses machine learning in some capacity.

2. What Does SEO Have to Do With Machine Learning?

For a while now, we’ve referred to Google’s ranking system as “the algorithm,” or as it should be called “the algorithms.” In essence, Google has been using artificial intelligence techniques since 2012. But only recently has machine learning become complex enough to incorporate it into search engines.

But what does it mean for SEO now that machine learning is part of the picture? How will the future be different? Should we be worried?

Machine Learning Will Take Care of the Details

In some ways, machine learning will make an SEOs life easier. We won’t need to know as many technical things about websites and sitemaps and scripts. The machine will take care of most of that for you.

Right now, if there is an error on your site an API notifies you. But it doesn’t fix the error for you.

Google’s Search Console will be able to help you out rather than merely alert you.

Machine Learning Will Make New Details Important

Now that people use voice search and Google Home and Alexa more often, websites need to be optimized for these platforms. If they aren’t accessible, machine learning has nothing to learn from.

This means a whole new layer of SEO that previously didn’t exist. But if you do implement these new aspects of SEO into your website, the benefits will outweigh the cost in time and complexity.

While some aspects will be easier, you will still need your SEO technical knowledge in the future. Don’t let your continuous learning slide.

Content Will Be Emperor

When content was king, you thought that maybe someone would dispose it. But content wasn’t content to be king. It wanted more power.

Now it will have all the power.

At the moment, other on-page factors still influence SEO. But as machine learning takes over, links and technical factors will become meaningless.

User intent is the ultimate goal here. Google wants to give users EXACTLY what they want. And as the machine learning algorithms study how people search, it will quickly realize the exact kinds of content people are *really* searching for when they type in a query.

SEO for Chiropractors and other fields that know nothing about the technical side of search will get easier. A company can focus on creating awesome content for their page rather than artificially inserting links and spending time on backlinks.

Some Scary Thoughts

Is this scary? For those unwilling to adapt, yes. Your bread and butter will come from different sources.

Quality will be of utmost importance. And learning what the algorithms consider “quality” will be the ultimate task of the SEO expert.

You will ask whether the page provides a positive experience more often than whether it matches some technical aspect of website design. You will be measuring utility and conversion power. And you will find ways of measuring intent.

Why? Because Google’s machine algorithm will be able to “read” content just like a human. But it will have the capacity to compare and learn from content better than a human.

Yes, this will make our jobs more challenging. But the situation isn’t nearly as dire as you might think. The sky isn’t actually falling.

We Will Outsmart the Machine

Links that provide zero benefit to a user will be painfully obvious to an intelligent machine. If it sees that people bounce back from a link immediately, then that link is worthless.

It will be able to read context and understand whether it was placed there as an actual reference or as an attempt to fool the algorithms.

Search engine optimization will have to get smarter before it can win against the machine.

If you’re interested in more SEO content, check out some Shoemoney.



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Rise of the Chatbots (and the Brands Who Love Them)


Our history with machines has always been one of brute force. We drive our cars by forcing air and gasoline into a tiny chamber that then ignites and runs an engine that in turn torques a shaft. We program computers, thus bending them to our will.

But what if instead of forcing our will on machines, we eventually begin to work alongside them? Will they be willing to work alongside us?

In Transformers, some bots protect us while others attack. But in the real world, our machines aren’t sentient…yet. Our closest approximation is artificial intelligence, chatbots and the like.

But what happens when chatbots start passing the Turing test? We replace humans with them, of course!

We’ve been replacing humans with chatbots for a while now. It’s only recently that they’ve been convincing enough to fool people into thinking a human is on the other end.

1. Chatbots: A History

In 1966 Eliza was born. An MIT professor named Joseph Weizenbaum programmed Eliza to mimic human speech. She was merely a set of rote responses, but she passed the Turing test during short duration exams.

But longer conversations with Eliza proved her to be nothing but a clever program.

As the century wore on we pushed A.I farther. In 88 we built Jabberwacky, an entertaining voice-activated A.I. In 95′ A.L.I.C.E. could use heuristic pattern matching rules to have a conversation and better understand how to respond.

The internet accelerated the process. Smartchild hung out on various text messaging networks in 2001 and hailed a new dawn for chatbots. Soon came IBM’s Watson 2006 who later won against two former Jeopardy! champs in 2011.

Watson was the first real machine learning chatbot. It could use natural language processing and glean new information and piece it together to form insights.

Watson opened the door for chatbots like Siri, Google Now, and Alexa. And in 2016, Facebook jumped on the ChatBot bandwagon and allowed users to create their own bots to work with Messenger.

ChatBots are now everywhere and as long as they don’t turn out like Microsoft’s machine learning A.I., Tay, then the future looks bright.

2. What’s a Chatbot to Do?

One unusual chatbot recently cropped up. Replika.

Originally, Replika wasn’t meant to go public. It was a machine learning A.I. built by Eugenia Kuyda to help her through the grieving process.

She built the chatbot to pour over thousands of her dead friend’s chat conversations. The bot then began to sound just like her late best friend.

This is a very different chatbot than what you see on various websites around the web. It uses machine learning to learn your patterns and emotions. And then it begins to mimic you.

It’s a more complicated version of Eliza from the 1960’s. And you can connect it to your Facebook to help it learn to be more like you.

The original idea behind Replika is to create a convincing version of you to leave behind after you die. But it can’t necessarily be trained to do the bidding of a marketer.

How ChatBots Are Used in Marketing

One of the biggest boons to marketing chatbots came when Facebook opened the way for chatbot capability in their Messenger app. These could be branded and represent a company’s customer service.

Before chatbots arrived, customer service was always a pain for both businesses and customers. If you wanted to contact a larger company about an issue, you waited on hold with thousands of others.

If you tried to contact a small business, you waited on hold with two other people or left a message and waited. You only had a question that would take a minute to ask.

Now both large and small businesses alike can rely on chatbots to take care of customer service. Customers get their concerns resolved and business owners can use their valuable time actually running their business.

Chatbots Can Perform Consumer Analysis

Chatbots not only take care of customer service problems, they track responses as they do so. This is useful information you may not have time to track yourself.

And not only can they track the data, the bot can often perform real-time analysis on the data as well. As the bot analyses the customer’s responses, it can use upsell procedures and perform rebuttals to draw customers into the sales funnel or get them to try different products.

Brands Will Be More Accessible

According to this article about a good inbound marketing plan, we end up seeing over 5k advertisements every day. That’s a lot of noise. And while brands would like to cut through all that noise, consumers too get tired of it.

But when there is a direct line to a brand such as an active Twitter account or a chatbot, customers feel like they are actually heard. And this is the ultimate use of a chatbot, to help customers feel heard.

3. Who Uses a Chatbot Anyway?

Major brands have been using chatbots for a while. Who are the big boys that already use chatbots?

Fandango

Instead of filling out forms and shuffling through showtimes, why not have a chatbot do it for you? This is exactly what Fandango’s chatbot does for customers.

Ask it to tell you what’s trending or where trending films are a playing near you, and it will give you the requisite information. No need to flip through various tabs on a website.

Whole Foods

Need a healthy recipe? Whole Food’s chatbot is there to help. It will even help you find recipes according to dietary restrictions and play twenty questions until it’s found exactly what you want.

And then you can just distill what it gives you into a list and head on down to your local Whole Foods for the ingredients.

The Chatbot Takeover

Chatbots are set to take over the internet…and maybe soon the world (just don’t fall in love with one or it might surpass you and leave you heartbroken). If you own a business of any kind, it might be time to implement a chatbot to suit your customer’s needs.

If you enjoyed this article, check out more online marketing articles on Shoemoney.com.



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The Marketing Secrets Behind The Walking Dead


Two zombies walk into a bar. Then 100 more. No, this isn’t a joke, it’s pretty much every episode of The Walking Dead ever.

You can only create a certain number of harrowing zombie scenarios before the genre becomes derivative. Even a show like TWD often fills whole sections with shambling corpses and heroes trapped in tight spaces.

But The Walking Dead is mid-way through Season 8 and ratings are slowly dropping. And yet, I am yet to find a fan who is willing to let go.

Whether you’re a hardcore fan of the show or not, it’s hard to deny that The Walking Dead is one of the most successful TV phenomena of this century so far. And as we stumble and groan our way into 2018, let’s pause to reflect on how AMC brought life to a tired genre through marketing.

1. Gorilla Marketing At Its Best

To keep marketing fresh, you essentially have to subvert everyone’s expectations. Breaking people out of their everyday reality takes creativity and work. Often that work falls flat.

But AMC was extremely successful in their marketing tactics with The Walking Dead. And often, they used what we call Gorilla Marketing.

Like gorilla warfare, gorilla marketing is an unconventional marketing style. It’s imaginative and in your face. And often the goal is to keep it low cost.

A man by the name of Jay Conrad Levinson coined the term in 1984. He wanted a way to create a memorable impression on people and at the same time create extreme social buzz. The man is known for extremely successful projects such as the Pillsbury Doughboy and the Marlboro Man.

Gorilla marketing isn’t just about the outward appeal of the design, but the concepts and ideas present. Essentially, the ideas must be clearly ironic. A gorilla message is one that punches the audience in the gut immediately.

Gorilla Marketing Examples

For example, a hunger awareness campaign might paste a lifesize photo of a starving child begging for food at the bottom of a grocery shopping cart. Whenever someone places food in their cart, they are placing it in the hands of the starving child.

This actually happened. And the Feed South Africa Campaign placed a simple placard near the shopping cart handle with the campaign’s logo and website.

You can bet that people felt the ironic guilt every time they placed a can tub of ice cream in that cart.

Gorilla Marketing Shouldn’t Be Complicated

It’s the simplest execution that’s the most effective. The dentist who creates a construction paper mouth around a telephone pole could be the simplest example of them all. Tear off a tooth with the dentist’s info and it looks like someone lost a tooth.

The more people tear off teeth, the more interesting the display becomes. And you can bet the dentist paid next to nothing for that advertisement.

Simple advertising is effective because people don’t have time to sit down and wrestle with an ad. You have mere seconds if not split seconds to capture someone’s attention before they walk on or scroll on by.

The idea behind Guerilla Marketing is immediate impact. Without that one-two punch, your message is meaningless.

2. How The Walking Dead Employed Guerrilla Marketing

One of the main tenants of Guerilla Marketing is social buzz. If you’re not able to great a buzz about your campaign or your product, then you’re not doing it right.

AMC is obviously doing it right. When your show attracts more than 16 million people each season, you’re on the ball.

Add that to the millions of re-tweets, facebook posts, fan-created podcasts and you have a phenomenon like few others.

And then there are the online reviews. The show has been well rated by every online metric you can find. And this makes sense, as this website points out, 88% of people trust reviews.

AMC admittedly didn’t need to do any other marketing after season 1. Word of mouth gave them plenty to work with. But their marketing team refused to lay down and die.

They’ve created numerous over-the-top displays. This includes a countdown display in Toronto’s Union Station. Fans could tweet a photo of themselves in front of the massive counting zombie hands to win one of the fingers (the fingers drop off as each day passes).

Mobile Marketing

Virtual worlds often invade our meatspace. And that’s exactly what AMC did to bring The Walking Dead directly in front of audiences.

In many cities, AMC employed an oft-used technique in marketing: mobile car advertising. They pasted large displayed on trucks and mashed fake zombie limbs in the doors. It looks as if the truck is carrying around zombies and the zombies are attempting to escape.

Guerilla marketing should invade your audience’s space. It should make your audience feel your presence even when they’re not enjoying one of your ads. They should feel like writing about it or tweeting about it.

It should, in essence, go viral.

Thanks, AMC

AMC’s zombie marketing has been so effective that people aren’t going to do a thing when the zombie apocalypse actually happens. If you watch this AMC walking dead prank in New York City, you’ll see what I mean.

People merely laugh when the zombies reach for their ankles. They know it’s a prank (fortunately for the actors, nobody carries guns in NYC). And AMC was brilliant in their execution.

The video went viral. Over 5 million views. But zombies are now a comfortable part of our world.

Thanks, AMC. Now it’s totally plausible that zombies will over-run our world. People are just going to write it off as one of your pranks…until they get eaten, that is.

If you enjoyed this article, check out other TV-related Shoemoney posts.



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Massive Affiliate ADdays – Eastern Europe conference.


The 2017 year was really saturated and very eventful. As you know, I have participated as an attendee and as a speaker in many events of the past year. Now, in new 2018, we should look forward to the adventures of this year and I guess it is a good time to tell you about one very interesting digital conference. So, let me cover one of the first major affiliate events of 2018 – ADdays Eastern Europe conference.

WHO ARE THEY?

Maybe some of you still are not really familiar with these guys. Then check their website and you will gain a deeper insight – https://addays.com/. ADdays conferences are the CPA marketing events that already have recommended themselves in Vietnam and Chile. You can enjoy photo and video reports on their official FB page – https://www.facebook.com/AddaysConference/.

WHY THEM?

So many digital conferences all around the world, why I tell you specifically about ADdays’ one? I’ll answer you why. I believe that many of you attended different soirees where, as you could see, organizers and exhibitors aim to make money as much as possible and don’t care about the usefulness and relevance of the information. To be honest, such events are made only for exhibitors, not for affiliates.

ADdays conference tells “no” to marketing speeches, greed, and widespread aggressive branding! I have first-hand knowledge that here all the speeches are focused on real cases and every guest may participate in actual information exchange in a friendly atmosphere. I know the main initiator of these conferences, so, I may surely say that the attitude to every attendee is very welcoming and amicable. Besides, it is a good chance for affiliates to know more about Eastern Europe growing market, as 70-80% of guests will be presented by local affiliates and companies with a lot of potentials.

WHAT WILL THEY GIVE?

The program of ADdays Budapest is focused on affiliate marketing, media – buying and traffic monetization, thus, the speeches are going to be really informative and full of practical tips 🙂 What else, these guys make really hot afterparties! Of course, the main aim of attending such events is to meet experienced and authoritative persons who can teach many useful things. But afterparty gives a real chance to bring beginners and experts together on a personal level, communicate together in the informal atmosphere and just relax!

WHERE AND WHEN?

This year ADdays digital event will be held in the capital of Hungary InterContinental Budapest on March, 3. All information about the placement check here – http://budapest.intercontinental.com/en/.
Want to join? Contact managers (you can find info on the homepage) and check all details you need here: https://addays.com/addays-eastern-europe.

By the way, tickets (Advanced and VIP) are already available for sale and you can buy them now with special discount – https://addays.com/addays-eastern-europe/buy-tickets! So, hurry up, my friends, time is running and ADdays Eastern Europe is near at hand!



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Power up Your Lead Generation with Linkedin


Supposedly, this last year, we were supposed to hit 297 billion emails sent daily as a planet. Whether we actually reached that, I have no clue. But that’s a lot of emails compared to the seven billion people who actually live on this planet.

And while email marketing does work, it’s becoming less effective every day. That means marketers will be searching for other ways to generate leads and explode that revenue.

But what are your options? You could go the traditional PPC route, and you probably already use that method. There are e-books and white papers.

All the methods combined and you have a cohesive strategy. But there is one route a lot of marketers neglect. That’s LinkedIn.

Yeah, sure, it’s a “social network” but it works differently than other networks. So, let’s dig in and find out exactly how one simply does generate leads through LinkedIn.

1. Build That Company Page

Let’s say you are a real estate company. You want your clients to know you are accredited and certified and all that junk. How do you expect them to know this without visiting your office and seeing the certificate hanging on your wall?

A great company page on LinkedIn tells clients that you’re certified…if you want it to.

Make sure you include every detail related to your business. You want all relevant experience and expertise listed. Be sure as well to link back to all your other social media.

That last one will show leads that you care about communication.

And for SEO purposes, don’t forget to link back to your website. Lastly, don’t forget to add visual content. You want to stand out from the competition on your LinkedIn page and you can do this by posting photos and video and infographics.

2. Slide Into Their DMs

Let’s say you have a flat fee MLS listing page. And you want to drive leads to that page. Use your LinkedIn page as a cheap landing page.

If you followed my #1 bullet point, you already have an incredible company page on LinkedIn. Why not use it as a landing page?

Once people connect with you on LinkedIn, you have the perfect “in” to convert them into clients. And that “in” is the private message service.

If you want to seem personal, this is probably the best way to go. And no longer will you have to be the one at the computer typing away to leads. LinkedIn now allows chatbots.

So put the AI to work for you and start turning those leads into clients.

3. Use the Blogging Feature on LinkedIn

You can show your expertise on LinkedIn by writing blogs. Yep, LinkedIn has a blogging feature that allows companies to show they are experts in their field.

This also allows you to insert links into your content and take advantage of the limited “link juice” you’ll get from LinkedIn.

But the biggest advantage of blogging on LinkedIn is access to a major audience. There are over 460 million users on LinkedIn, and if your articles get shared around, you’re going to see some LinkedIn love.

4. Stay Relevant

While LinkedIn isn’t nearly as popular a social network as Twitter or Facebook, clients still look to LinkedIn pages for new information about a company. If you’re not keeping your LinkedIn page current, you’re missing out on a major opportunity.

If you sell property, for instance, be sure to keep potential clients abreast of the market by posting on LinkedIn about new opportunities. Update leads on new property marketing ideas. And share news about the market.

Other companies might share your information if they find it useful and link back to your page. And if you gain any number of followers, that audience will appreciate fresh content on your LinkedIn page.

5. Take Advantage of Showcase Pages

Showcase pages are subpages in LinkedIn meant to show off a specific product or service. It’s a way of niching down your page to cater to certain audiences.

If you service several niche markets, showcase pages are a great way of keeping each audience separate and staying personal to that market niche. And once you’ve published this information, LinkedIn is kind enough to give you analytics on each showcase page separately.

A showcase page looks more like a traditional newspaper with two columns for content. When leads see a showcase page, they can’t navigate away quickly. The page doesn’t feature tabs on top like your common LinkedIn page.

And the only links inherent on the page lead back to the main business page acting like a defacto funnel. Plus, no employee page is associated with a showcase page. The sole focus of the page is the product or service and nothing more.

6. Use It for Its Intended Purpose

Networking. This is the real reason LinkedIn exists. It’s there to network professionals. And growing your network can only do one thing. Increase your ability to find leads.

If you can partner with other companies in your niche, guest post, get featured in podcasts and videos, you’ll quickly increase your audience. And sometimes you’ll even make old connections new again.

If your company is old enough to have existed before LinkedIn, then you may have lost contacts over time that meant lead generation in the past. With networks like LinkedIn, you have the opportunity to reconnect with past leads and rekindle a relationship.

Even if these old leads aren’t interesting in your product or service anymore, they could be a great referral source for your business.

LinkedIn: The Veritable Referral Machine

Any business that relies on referrals as their bread and butter would be grateful for any opportunity to boost their referral game. LinkedIn is this opportunity.

It’s a referral machine that allows you to ask for recommendations from pretty much anybody, and it sometimes does this on its own using a patented algorithm.

So get out there, make your LinkedIn presence count and be sure to check out more lead generation advice.



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Why it’s important to put first things first ~ Get Rich Slowly


Holy cats! That was an interesting 72 hours.

For the past three days, I’ve been fighting a terrible cold. Or maybe the flu. I’m not sure which. It hasn’t been fun.

On Sunday, while I was in Florida attending an early-retirement retreat, I woke with crap in my lungs. All day, I was coughing and sneezing and hacking. I still felt relatively strong, though, so I made sure to get in my four-mile training run. (I made two goals involving running this year: I want to run at least one mile every day and I want to run a half marathon at the end of March.)

On Monday morning, I felt worse. Still, I rolled out of bed and tromped the one mile I had scheduled for myself. It was a l-o-n-g mile, let me tell you. I was wheezing and gasping the entire ten minutes.

The six-hour flight home to Portland on Monday afternoon was miserable. I hate flying when I’m sick, and I know how much that sucks for other passengers. I huddled next to the window and tried not to breathe too deeply. Breathing too deeply rattled the crap in my lungs and sent me into fits of coughing, so I mainly zoned out and made an effort to take shallow breaths.

“You sound terrible,” Kim said when she picked me up from the airport. That night, she made me sleep in the guest room.

I spent all yesterday fighting a high fever. I tried to write an article, but it was a futile endeavor. I couldn’t focus. I couldn’t write or read or even watch TV. (I starting watching the new Blade Runner movie, but I couldn’t focus for more than a few minutes at a time.) I could barely focus on videogames.

In the afternoon, I felt a little better, so I decided to take the dog for a walk. “I have a three-mile training run scheduled today,” I thought to myself. “I probably shouldn’t do that. But surely I can do just a mile.” I put on my running clothes, grabbed the leash and the dog, and headed outside.

After two minutes of running — and less than a quarter mile — I pulled up short. I couldn’t catch my breath. I felt like I was going to faint. I walked the dog back home and crawled into bed.

And that’s how my goal of running at least one mile each day in 2018 came to an end.

Blind Pursuit of the Less Important

My example of blindly pursuing a small goal at the expense of the Big Picture is relatively minor. It’s not a big deal. But it’s not hard to find examples of people doing this on a grander scale, which can lead to all sorts of complications.

I’ve noticed, for instance, that many people who discover the ideas behind early retirement become laser-focused on their “number” — the amount they need to save in order to reach financial independence (a.k.a. FI). They rearrange their lives so that they can save 50% or 70% or 85% of their income, but never take time to figure out what they’re saving for. Why are they saving for financial independence? What’s the purpose?

Then a crisis occurs and they realize the goal they’ve been pursuing was a red herring. Financial independence and early retirement aren’t the actual objective — and they never were. A happy life filled with meaning and purpose is what they really want; financial independence is merely a tool to help them achieve it.

I see this all of the time in the financial independence community. Everyone who reads FI forums can tell me what their number is — but only a handful can tell me why they’re pursuing FI.

Here’s a classic example. Yesterday, in the financial independence forum on Reddit, an anonymous user posted a heart-breaking story about losing the love of his life because he was too focused on money — too obsessed with how and what and not enough on why. Here’s his story:

I should be clear, it’s because I obsessed over FI and ignored my life goals.

Together for 7 years, living together for most of it. She was perfect for me and was also very frugal. I had it all.

I read the stickied post. “Find the live you want to live and save for it”, or whatever it’s called. But I didn’t take it to heart. I thought I was doing this. I didn’t understand. I was so wrong. I was blind. I was living the life I wanted to but I was ignoring the life that my partner wanted.

I didn’t spend money with her to do the things she really valued. I didn’t buy plane tickets to go visit her family with her when she desperately wanted me to come. My whole life I said I wanted kids and then discovered FI and changed my mind because they were too expensive. I refused to buy nicer furniture for our apartment and made her embarrassed about our place and not comfortable in her own home. Over and over I made this mistake and we drifted apart. She wasn’t asking for much, just for things she really valued. She is frugal. I was selfish. And I lost sight of the fact I always wanted kids.

I realize this all now but it’s too late. I told her all of this but it’s too late. Don’t be me. Examine every facet of your life and think about it. I regret it all.

FI ruined my life, but it’s my fault, not FIs fault. It was my obsession. So here’s my advice. Focus on the life you want to live, but compromise with your partner too because I’d trade all the money in my bank for that relationship back. And once you are in the boring middle…focus on what makes you and your family happy today.

Don’t be me. Don’t get obsessed. Live in the present.

Goals are good. Goals keep us motivated. They give us meaning and purpose. They spur us to become better versions of ourselves. They help us learn and grow and develop into more interesting human beings.

But some goals are less important than others. Some goals are meant to support higher-level goals.

Putting First Things First

I believe strongly that financial goals ought not be top-level goals in your life. Your financial objectives are there to help you pursue more important things. Because of this, there are times you ought to set money considerations aside to attend to more important matters.

This isn’t just true with financial goals, of course. It’s true with all goals that support larger purposes.

In my case, running one mile every day this year wasn’t my real aim. When I take a step back to look at the Big Picture, I realize that specific goal on its own was meaningless. That goal was actually representative of a larger goal — to get fit, to exercise more often. Running every day was merely a manifestation of a deeper desire.

In that context, it’s no big deal that I’m going to miss two or three days of running while recovering from being sick. In fact, the time off is a good thing.

As you work toward your goals — financial and otherwise — please remember to place them in proper context. Prioritize the important stuff. Don’t sacrifice a greater good for some lesser aim. Don’t give up your long-term health just to keep a running streak alive. Don’t sacrifice a relationship simply so you can attain some arbitrary savings goal.

Put first things first.

“Putting first things first means organizing and executing around your most important priorities. It is living and being driven by the principles you value most, not by the agendas and forces surrounding you.” — Stephen R. Covey, The Seven Habits of Highly-Effective People



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How to get out of debt (without gimmicks or games) ~ Get Rich Slowly


As part of back to basics month, let’s use today to explore how you can get out of debt without gimmicks or games.

How to get out of debt without gimmicks or games

After twelve years of reading and writing about money, I’ve come to believe that debt reduction ought to be a side effect and not a goal. Getting out of debt is a target, not a habit. And, as we’ve been discussing recently, good goals are built around actions instead of numbers. If you restructure your life so that you’re spending less than you earn, you will get out of debt. It’s a natural side effect.

Having said that, I realize that a lot of GRS readers are struggling to get to square one. Getting out of debt is their goal and primary obsession. That’s okay.

Before you can begin repaying your debt, you must be earning a profit. Unless your income exceeds your expenses, your debt is actually increasing. If you’re continuing to add debt, or if you’re only able to make minimum payments, you must first find ways to spend less and earn more until you have a positive “saving rate”. (Both businesses and people earn profits. But when individuals earn a personal profit, we call it “savings”.)

After you’re earning a personal profit, you can (and should) make debt elimination a priority.

Why You Should Pay Off Your Debt

Debt repayment can improve your credit score, meaning you’ll pay less on everything from rent to car insurance to future borrowing needs. Plus, debt reduction is one of the best returns you can earn on your money.

Investing in the stock market provides an average annual return of about 10% — but that return isn’t guaranteed. Some years the market is up 30%, but other years it drops by 40%. When you pay down a credit card, you earn a guaranteed return of 20% (or whatever your interest rate is). That’s tough to beat.

There are also non-financial benefits to paying off debt, including:

  • Simplicity. The more debt you have, the more bills you have. It’s easier to manage your money when you have a simple, efficient financial infrastructure. Each time you pay off a debt, you move one step closer to this ideal.
  • Cash flow. Whenever you eliminate a debt, the money formerly used for that monthly payment becomes available to pursue other goals – including fun stuff like ski trips and knitting supplies.
  • Freedom. When you have monthly payments to meet, you’re chained to your job. You’re unable to take risks. Once your debt is gone, a wider range of options becomes available to you.
  • Peace of mind. Best of all, once you’re debt-free, you can sleep easier at night. You’ll put less pressure on yourself, and you’ll have fewer fights about money with your partner.

When I first tried to get out of debt, I lacked a system. Without a plan, I sent extra money to one credit card and then another. As a result, I never seemed to make any progress.

After deciding to become boss of my own life, however, I researched how to get out of debt. Many books recommended a strategy called the “debt snowball”. Although I was skeptical, I gave it a try. The method worked. Using it, I managed to eliminate my debt and begin saving for the future.

The Debt Snowball

With the debt snowball, you set aside a specific amount of cash each month to pay off the money you owe. At first, progress is slow. In time, however, you begin to make rapid progress, picking up speed like a snowball rolling downhill.

Step One

The first step is to make a list of your debts. For each obligation, include the balance you owe, the interest rate, and the minimum payment. Arrange the list so that the debt with the highest interest rate is on top. Next comes the debt with the second-highest interest rate, and so on, until you reach the final debt on the list, which will be the one with the lowest interest rate.

For instance, here’s the actual list of my debts from October 2004, ordered by interest rate:

  • Computer Loan: $1116 @ 15% ($48 min)
  • Business Loan $2800 @ 11% ($30 min)
  • Home Equity Loan $21000 @ 6% ($100 min)
  • Car Loan $2250 @ 5% ($170 min)
  • Personal Loan $1600 @ 3% ($100 min)
  • Personal Loan $6430 @ 0% ($60 min)

I had $35,196 in debt and my minimum payments totaled $508 per month.

Step Two

Once you’ve listed your debts, decide how much you can afford to pay toward them each month in total. This should be at least the total of your minimum payments ($508 in the example above), and preferably more. In my case, I started by allocating $700 every month toward debt reduction.

Step Three

Now, for all of your debts except the debt with the highest interest rate, make minimum payments every month. Use the rest of the money you’ve allocated for debt reduction to pay down the debt with the highest interest rate.

The computer loan topped my list of debts with an interest rate of 15%. The minimum payments for the other debts combined to $460 per month. Under this plan, I’d then take the remainder of the $700 I’d allocated toward monthly debt reduction and apply it to the computer loan. Instead of making the $48 minimum payment, I’d pay $240.

Step Four

Repeat this process every month until the debt at the top of the list has been eliminated.

Step Five

Here’s where this method gets powerful. With your first debt defeated, you don’t use your improved cash flow to buy new things. Instead, you use the extra cash to attack the next debt on your list.

If I start by applying $700 toward debt each month, for example, I continue to apply $700 toward debt each month until all of the debt is gone. After the computer loan is retired, I focus on the business loan. Because the minimum payment on my other debts would be $430, I could funnel $270 to pay off the business debt every month.

When the business debt is gone, I’d then throw $370 per month at the home equity loan, and so on. Ultimately, I’d be left with a single loan: the $6430 personal loan at 0% interest. Every month, I’d apply all $700 to get rid of this debt.

Pros and Cons

The debt snowball is powerful and effective. Mathematically, it’s the best way to get rid of your debt. There’s just one problem.

When you attack your debts from highest interest rate to lowest, you’ll pay less money in the long run. Unfortunately, many folks – including me – find the going difficult. In my case, I hit a wall when I reached the third debt on the list, my home equity loan. That $21,000 balance was going to take years to repay. I didn’t have that kind of patience.

Fortunately, I learned there were other ways to order your debts. You don’t have to tackle the high interest rates first.

Snowball

Building a Better Snowball

Humans are complex psychological creatures. They’re not adding machines. Many of us know what we ought to do but find it difficult to actually make the best choices. (If we were adding machines, we wouldn’t accumulate consumer debt in the first place!) It’s misguided to tell somebody so deep in debt that they must follow the repayment plan that minimizes interest payments. The important thing to do is to set up a system of positive reinforcement.

Because of this, many people prefer slight variations on the debt snowball method. These methods ignore math in favor of psychology.

Dave Ramsey’s Debt Snowball

Financial guru Dave Ramsey has popularized one variation of the debt snowball. Instead of ordering your debts by interest rate, he suggests you attack those with the lowest balances first.

Using Ramsey’s method, my debts from 2004 would be ordered like this:

  • Computer Loan: $1116 @ 15% ($48 min)
  • Personal Loan $1600 @ 3% ($100 min)
  • Car Loan $2250 @ 5% ($170 min)
  • Business Loan $2800 @ 11% ($30 min)
  • Personal Loan $6430 @ 0% ($60 min)
  • Home Equity Loan $21000 @ 6% ($100 min)

As with the standard debt snowball method, I’d make minimum payments on each debt except the top one on the list. At it, I’d throw everything else I’ve allocated for debt reduction each month. When the top debt was eliminated, I’d move on to the one with the next smallest balance.

Ramsey’s variation isn’t as quick as paying high-interest debt first, and in the long-run, you’ll lose slightly more to interest payments. (In my own case, the projections showed it’d take an extra month to repay my debt and I’d pay and extra $841.15 in interest.) However, there’s a psychological advantage to doing things this way.

By attacking your smallest debts first, you get some quick wins, which provide a mental boost. This psychological lift provides extra motivation to keep attacking that debt. Every few months, you get the satisfaction of crossing another debt off the list! Ramsey says this is “behavior modification over math”, and he’s right. In fact, I opted to use this variation of the debt snowball when I repaid my own $35,000 of debt in 39 months.

Adam Baker’s Debt Tsunami

Other experts, including my buddy Adam Baker from Man vs. Debt, suggest yet a third alternative they call the debt tsunami. They argue it’s best to pay off your debts in order of their emotional impact. Attack your debts from smallest balance to highest, they say, but for added psychological boost, prioritize any debt that particularly bugs you.

“I used to be addicted to gambling,” Baker says, “and I had debt that was specifically associated with gambling. To pay that off first changed me as a person. To pay off the $600 I owed on a credit card was great, but it didn’t change me. It didn’t signify that my life was going to be different and that I was going to live in a different way.”

But paying off his gambling debt did mean something to him, so Baker attacked that first.

Here’s another example: Many people borrow money from their parents. These loans may carry interest rates of only two or three percent (or maybe they’re interest free), but they come with a lot of psychological baggage. This is another instance where it might make sense to pay down low-interest debt first because the non-financial rewards are so great.

The most important thing when paying off your debts is to pay off your debts; the order in which you do so is ultimately irrelevant. Find a system that works for you and develop the discipline to stick with it.

Note: It’s less imperative to repay low-interest debt. Businesses use “leverage” to borrow money cheaply so that they can earn higher returns elsewhere. You do the same when taking out a mortgage at low rate (like three percent) or using school loans to improve your education (which will, in theory, provide high future returns). It’s good to repay all of your debt, of course, but it’s okay to make repaying the mortgage a long-term goal instead of lumping it in with your debt snowball.

The Bottom Line

As I mentioned at the start, I’ve come to believe that debt repayment is a side effect and not a goal. You shouldn’t make it your primary purpose.

If you do the other things I recommend, such as creating a personal mission statement and boosting your profit margin, you’ll naturally pay off debt as a matter of course. But you’ll enjoy a benefit many people don’t have once their debts are gone.

You see, a lot of people feel lost once they’ve dug out of debt. Search online and you’ll find tons of questions and conversations about what to do next. Debt repayment had given them purpose, and now that purpose is gone. As a result, they lose financial direction. And like a dieter who had aimed for a weight instead of a lifestyle change, an unfortunate few of the newly debt-free find themselves resuming bad habits.

If you’re pursuing other goals and intentionally building good habits, you’ll get out of debt. And once you get out of debt, the good times will continue: That debt snowball you’ve been building will transform itself into a wealth snowball.

Congratulations! You’re on your way to financial freedom!

Have you ever had to dig out of debt? What methods did you use? Were some more successful than others? If you had to do it over again, would you have done anything differently? What advice would you give to others who have just taken on the role of money boss in their lives?



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I was a frugal jerk


This guest post from the Frugal Jerk is part of the “money stories” feature at Get Rich Slowly. Some stories contain general advice; others are examples of how a GRS reader achieved financial success — or failure. These stories feature folks from all stages of financial maturity. Today, the Frugal Jerk — who has asked to remain anonymous for now — shares the first half of his story about going from internet entrepreneur to busted and broke.

I was a frugal jerk!

You might know me. I’m a blogger and entrepreneur. I’ve had tens of thousands of customers during the last decade, so it’s very possible that you’ve purchased something from me in the past.

I’ve been read by millions of readers on my own sites and I’ve appeared as a guest writer on popular websites you’ve surely heard of. I’ve also been featured in New York Times bestselling books that may sit on your shelf. At my peak, my income was $300,000 per year. By many accounts I would be considered successful. But I’ve made many dumb mistakes with money.

We’re not going to bury the lede: At a certain point, because of a perfect storm of mistakes and problems, the smartest move was to foreclose my home. This move may have even saved my life. This is that story.

What’s interesting about all of this is that I grew up fairly poor and conservative with money. If I couldn’t pay for something in cash then I didn’t buy it. I didn’t make stupid financial decisions. Those decisions were for idiots. I was no idiot! (Reality check: Everyone is an idiot sometimes.)

Buying the Hype

When I bought my home, everything was going great. In the run-up to the U.S. recession, houses wouldn’t stay on the market for long. If you remember those days, you know that you could go to a first open house and the house would often be sold before you got there. It got to the point where houses were regularly selling for more than asking price. Bidding battles were not uncommon.

This should have been a warning. But I was young and dumb and flush with cash. I had a business generating almost $1,000 in profit per day. Mostly automated. All online. What to do with all that money? Home values always go up, right? It’s always smart to “Buy! Buy! Buy!” isn’t it? We all heard it daily. (You might still hear it regularly since the economy has improved lately.) Plus, it’s the alleged American Dream. Quite literally everybody around me told me to buy, particularly those who knew my income. Parents, friends, the echo chamber in the media. I didn’t hear a single dissenting opinion. (Besides my own, which I steadfastly ignored.)

So I bought a home.

Considering my income, I thought I was making a smart choice. I settled — and I do mean settled because I didn’t even like the home — on a $300,000 four-bedroom three-bath two-car-garage home. I was a young single guy with a huge family home. I know what you’re probably thinking. But it was “only” one year’s income and I put 20% down. What could possibly go wrong?

Hahahaha.

If you’ve been a working adult over the past decade, you know the answer.

Nearly everything went wrong.

The stock market tanked. The housing market tanked. And, most relevant to my eventual foreclosure decision, my income tanked. The year I bought my home, I made about $300,000. The year after, I made less than $50,000. The year after that? Less than $20,000.

It was a massive blow to not only my finances but also my ego.

The Shiller Index of Home Prices

In the Beginning

My beginnings probably aren’t atypical of folks who read sites like Get Rich Slowly.

I started working and saving at around age 13. I had a checking account and kept it balanced all through high school. I graduated from a four-year university with a science degree and not a single dollar in debt. Actually, because of the business I started while in school I graduated college with over $50,000 in savings, including $10,000 in a Roth IRA. Who starts a Roth IRA in college? The Frugal Jerk, that’s who.

Even though I had all this savings, I still felt poor. What’s $50,000 when others folks are millionaires and billionaires? Some call this a scarcity mindset, and maybe it’s a result of growing up “not rich”. We always had electricity and food and went on the occasional vacation (often camping). But I was an LA Gear child with Nike Air tastes. Maybe you can relate?

Like many folks in similar situations, I was raised with a faulty money blueprint. I wasn’t taught the value of money or the thought process behind saving and spending. But I was taught that rich people were to be venerated and poor people disparaged. There was nothing worse than to be poor or in debt or to ask for help. (The ultimate sin was getting any help from the government.)

I was told things like, “No, too expensive. You’ll end up like one of those poor people.”

I was taught to buy the cheapest, even if the more expensive is in the budget, better quality, and more useful. (Now I know a simple cost-benefit analysis can go a long way to helping decide whether to buy something that’s cheap versus something more costly.) The point is that as I became an adult, even though I was debt free and had a significant savings account, I felt poor, was terrified of actually being poor, and I wanted a lot more. And I got it. For a while anyhow.

The positive side of growing up the way I did is that I was taught debt was generally bad (except for a mortgage or car note, for whatever reason). I wasn’t taught why debt was bad, but the lesson mostly stuck. I never — not once in my life — carried a credit card balance. I never paid my bills late. I bought everything in cash, including a luxury automobile.

Wait, what? Frugal with a luxury automobile?

Well, I quickly fell into the classic spending trap once I started earning big. What’s $60,000 for a car when you’re earning that much in just two months? I wrote a check and paid extra to have the specific vehicle I wanted driven cross country and delivered to my door. (In case you’re wondering, that costs over a thousand bucks.) I couldn’t wait to show it off. To whom? To all the poor unsuccessful suckers around me. “Ha! I’m so smart. I bought this expensive car for cash! All these other idiots are using financing. So dumb.”

See? I was already a jerk — but no longer frugal. Obviously.

Things Fall Apart

So, the recession was in full swing although many of us were in denial. Me? Well, as I said, my income tanked and my home’s value tanked. My Roth IRA was worth about what I put into it. My mortgage and home-related expenses were eating close to $25,000 per year, so I was spending more than I was making. (My income fell to below $20,000, remember?) Things were not going well for me.

I decided to try to sell my home.

I listed it below my purchase price. It wouldn’t sell. I set an arbitrary limit to the hit I was willing to take on the home; I was hoping I wouldn’t lose more than $30,000 (or ten percent). In retrospect, I should have done whatever it took to sell. But that’s the thing about hindsight: It’s too easy to look back and judge. I didn’t think things would keep getting worse and I was using emotion instead of logic to make my decisions.

Did I say Frugal Jerk? Frugal Idiot is more like it, right?

But we’re still not to the point of foreclosure. I hustled hard, got some of my income back, and was once again earning nearly $10,000 per month. Not anywhere near what I made before, but a great income nonetheless. I could replenish some of my savings and maybe not worry so much about expenses anymore.

Unfortunately, we still hadn’t seen the worst of the recession. At this point houses like mine were still sometimes — rarely — selling for over $200,000. It wasn’t the $300,000 I bought mine for but it also wasn’t the $120,000 or less they’d eventually sell for. I was uneasy. I didn’t want to take a $100,000 hit on my home (which would take out the majority of my savings), and I didn’t feel like I had many options besides sticking it out and hoping for the best.

Then my income tanked again. Hope wouldn’t — couldn’t — save it. Because, in case you’re unaware, hope is a terrible strategy in business and in life. (Particularly in finance.)

Darkness Visible

Maybe I’ve left out something important: During this time I was also dealing with suicidal depression and debilitating anxiety. Not the result of financial troubles, but certainly exacerbated by them.

The Opposite of This

Getting out of bed or going grocery shopping was unbearable (and, frankly, a rare occurrence). I often went weeks without speaking to another human being. If I had to, I’d do my grocery shopping at 3 a.m. so I could avoid other people. If you’ve read Darkness Visible by William Styron or even Allie Brosh’s more accessible book Hyperbole and a Half, then you might have some understanding of what this kind of depression feels like. It’s something I’ve dealt with since a young age. And by “dealt with” I mean I shut myself off from the world and kept it all in.

It’s no wonder my chosen career path was to sit in front of a computer and not speak to people on a day-to-day basis. Some might say that career path was more curse than blessing. While it’s provided an interesting life, it hasn’t been without consequences.

Living with the proverbial dark cloud of depression is difficult enough. Doing it while also dealing with income uncertainty and a crashing economy? Yikes! Clearly I’m still here, but it was almost too much to handle. Thankfully, humans are resilient creatures. Even jerks like me.

My foreclosure process was long and grueling. From the time I missed my first payment until the day the house was actually foreclosed upon took three years. But, believe it or not, the experience was one of the most positive things to happen to me as an adult. It forced me to re-evaluate my relationship with money and with life itself. I also learned how to start over with nothing, from the bottom of the heap with a broken credit score.

For more on that, stay tuned for part two of my story next week. And if you have more questions than answers leave them in the comments. I won’t answer them here because I’m a jerk — but I’ll cover them in the future.

Reminder: This is a story from one of your fellow readers. Please be nice. After twenty years of blogging, I have a thick skin, but it can be scary to put your story out in public for the first time. Remember that this guest author isn’t a professional writer, and is just learning about money like you are. Unduly nasty comments on reader stories will be removed or edited.



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Developing self-reliance ~ Get Rich Slowly


Earlier this week, I encouraged readers to become proactive by developing an internal locus of control. In that article, I wrote:

You are the boss of you. You don’t need anybody’s permission to get out of debt or to buy a house or to ask for a raise. And nobody’s going to come to you out of the blue to explain investing or health insurance or your credit card contract. Take charge yourself.

“I get it,” you might be thinking. “Self-reliance is great. But how do I change? How do I get from where I am to becoming a more self-reliant person?”

In today’s installment of GRS Theater, we’re going to look at another fun educational film nearly seventy years ago. This short video (targeted at teenagers) aims to help viewers become more proactive.

“If you’re not self-reliant, you’ll never do any more than just ‘get by’,” says the narrator.

I love how in his desk, Mr. Carson, the French teacher, just happens to have a typewritten card with the four steps to self-reliance. “Learning to be self-reliant takes time…and hard work,” he says, handing young Allen the list.

Here are Mr. Carson’s steps, with a bit of elaboration.

  1. Assume responsibility. Take the blame for things that are your fault; look after your own work; plan your own time; depend on yourself to get things done.
  2. Be informed. If you don’t know some vital piece of information, find it out. Ask. Get the facts you need to make smart decisions. Knowledge gives you power. Ignorance puts you at the mercy of others.
  3. Know where you’re going. Set smart goals. Have a long-range plan so that you understand the general course you’re trying to make through life. Don’t simply react passively to the world around you.
  4. Make your own decisions. Develop the ability to think for yourself. Don’t rely on others to make choices for you — that’s a sure route to unhappiness. Be decisive.

These steps are very similar to habits espoused by modern self-help gurus. Taking control of your own destiny is a great way to improve your satisfaction with life, to increase your happiness. The film picks up bonus points from this lit geek by name-dropping Ralph Waldo Emerson and his essay, “Self-Reliance”:

There is a time in every man’s education when he arrives at the conviction that envy is ignorance; that imitation is suicide; that he must take himself for better, for worse, as his portion; that though the wide universe is full of good, no kernel of nourishing corn can come to him but through his toil bestowed on that plot of ground which is given to him to till. The power which resides in him is new in nature, and none but he knows what that is which he can do, nor does he know until he has tried.

In the film, we get to watch as young Allen gains self-reliance, which transforms him from a dependent child to a confident young adult. Eventually, he becomes a leader among his classmates.

“Yessir,” says Mr. Carson. “That was self-reliance — the kind we can all use. It’s hard work to become self-reliant…[but] Allen learned to do it, and he’s a certainly a happier and a better person for it. Will you develop the habit of self-reliance?”



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How to shop for high-quality clothes ~ Get Rich Slowly


I’m in Florida for ten days to attend a couple of weekend early retirement retreats. At Camp FI, about 50 or 60 people gather for three days of what Mr. Money Mustache calls “crazy rich people talk” — real estate investing, travel hacking, gift card arbitrage, 70% saving rates, and the rewards of frugality and thrift.

One afternoon, the conversation turned to clothing. Given that so many people in the room had a net worth of more than a million dollars, a surprising number of us still bought our clothes at thrift stores.

Cheapskate Millionaires

“I can’t bring myself to pay more than ten dollars for a t-shirt,” one guy said. We all nodded in agreement.

“I don’t pay anything for t-shirts,” said another fellow. “I travel a lot for work. When I go to conferences, I often come home with three or five or ten t-shirts. There’s no point in ever paying for them.” Throughout the weekend, I noticed that a lot of us wore t-shirts we’d picked up for free. (Because we’re money nerds, Choose FI t-shirts were prominent.)

“But what about quality clothes?” asked one woman. “I get why we’re all so cheap on the everyday stuff. But sometimes, I want clothing that looks good, that I can go out in.”

“I’m a long-time thrift store shopper,” I said, “and it’s taken some effort to allow myself to shop in regular stores. For quality stuff, I think it’s important to find a store with styles you like where the clothes also fit well.”

“I’ll give you an example. In the fall of 2016, I made a trip to New York City. The forecast was for warm weather, so I took warm weather clothes. Turns out, temperatures were much lower than expected. And it rained. I was unprepared. My hotel was next to a J. Crew store, so I stopped in. I had never shopped there before in my life, but I discovered I liked the stuff they had and their clothes fit me well. I didn’t like the prices, but I managed to find a few things on sale, so I bought them.”

I paused and looked down at the clothes that I had on. “Ha,” I said. “Right now, I’m wearing the dress shirt and sweater I bought that day in New York.”

Beyond Cheap

“I don’t shop at thrift stores,” said the man standing next to me. “I don’t like to have a lot of cheap clothes. I like simplicity and minimalism. So, I’m willing to pay more for my clothes because I buy only a handful of items and expect them to last a long time.”

“Can you give some examples?” somebody asked.

“Take this shirt I’m wearing now,” he said. “It’s a wool t-shirt from Icebreaker. And this jacket is from the same company. It’s more expensive — probably a lot more expensive — but it lasts a long time, looks good, and is very versatile. Merino wool is warm when it’s cold and cool when it’s warm. Plus, I can wear it for days on end without it stinking. I think that J.D. likes Icebreaker stuff too, right?”

“I do,” I said. “I brought two of their wool t-shirts with me on this trip. And because it’s freezing here in Florida right now, I brought an Icebreaker jacket.”

“I try to keep a small wardrobe too,” said another friend. “For me, that means always wearing the same thing. I have like four or five of the same t-shirt. I have two pears of pants, and they’re both the same. And all of my socks are the same. I don’t even fold them. I just throw them all in the drawer loose since it doesn’t matter which ones I pull out.”

Sidenote: I didn’t mention it during the conversation, but you can find quality clothes at thrift stores. They’re more expensive, sure, but not nearly as expensive as buying them new. The key is patience. Sort through the racks. You might only find one or two items per trip, but that’s okay. To increase your odds, find a thrift store in a nice neighborhood. Kim and I, for instance, recently discovered a consignment store near us called Simply Posh. It has lots of nice clothes at great prices.

The Quest for Quality

“You know, I read a great article recently,” I said. “I just shared it with the Get Rich Slowly mailing list. It’s all about how to shop for high-quality clothes. One of the points it made is that quality doesn’t have to be expensive — and that expensive doesn’t always mean quality.”

I gave an example. I’m a h-u-g-e bag nerd. I have far too many backpacks and travel bags. “One of my favorite places to buy bags is a company called Filson,” I said. “Their luggage is outstanding. Because of this, I thought their clothes would be high quality too. They’re not. Filson clothes suck. They’re still very expensive, but they’re all poorly made with awful fit. I’ve spent a ton of money on Filson clothes, but I’ll never spend another penny on a shirt or jacket from them. Not even a belt.”

“How can you tell quality clothes?” somebody asked.

The article I read says that the most important factors are fabric, fit, and construction,” I said. “Clothes that are made well with quality materials will last longer. They’ll be more durable. They’ll also look better. But like we’ve already talked about, nothing matters if the clothes don’t fit well. It doesn’t matter how much something costs if it doesn’t look good on you.”

“Yeah,” said one gal, who is a doctor. “That’s an important point. And I’ve found that clothes fit me much better when I am fit. If I’ve been exercising and I’m in shape, clothes fit like we’re supposed to. Plus, being fit gives me confidence, and that can make any outfit look sharp.”

How to Discern Quality

Later, when I got back to my room, I re-read the article about how to shop for high-quality clothes. According to the author, there are three things to look for when shopping for high-end clothes:

  • Natural fabrics. “From my experience, natural fabrics feel better against the skin, wash better, and last longer…If you have crappy, flimsy fabrics, the best designs and construction won’t save it.” The article offers tons of tips on how to shop for cashmere, wool, cotton, and leather clothing.
  • Construction. “The quality of construction depends on how well fabric pieces are stitched together. An initial test could be holding the garment up to the light and stretching one of the seams to see how much light comes through. If the thread is really tight and even, this is a good sign.” In the article, the author shows photos to demonstrate good construction versus poor construction.
  • Where it’s made. “Good manufacturing can happen in any country, but I’ll use the country to determine how much I’m willing to pay. For example, I know labor costs in the US is expensive, so I’m willing to pay more for an item made here.”

Although I’ve already read this article four times in the past month, I’ve bookmarked it to refer to in the future. In the past, I was always a poor dresser. I wouldn’t say my fashion sense is sharp yet, but it’s improving. (It helps that Kim has been gently prodding me for the past six years!)

Footnote: While writing this article, I stumbled upon the concept of the capsule wardrobe, which is a small (30-40 item) wardrobe deliberately built with high-quality, timeless pieces that all co-ordinate with each other. This contrasts with how most of us build wardrobes: randomly and in piecemeal fashion. More here.

We’ve talked about shopping for clothes several times in the past here at Get Rich Slowly. Here are two of the most popular posts: How do you build a wardrobe on a budget? and How much do you spend on clothes?



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