NOTE: I recently found this article on my hard drive. I had written it several years ago, during the dot.com downturn. I think it is still relevant today. --RPB
1. Max out your contribution to your IRA, 401(k), or other retirement plan. If your employer offers a retirement plan, put the MAXIMUM amount into it allowed by law, not the minimum. If you are not maxing out your retirement account, something is drastically wrong.2. Cut all subscription services: Cable TV, Cell Phones, TIVO, Satellite Radio, and the like all cost "small" amounts of money individually, but when added up, can run into hundreds of dollars a month. I know some friends who are not very wealthy, but spend over $150 per month on Cable TV. In addition to being a total waste of your life, this is a total waste of your money. You’ll be surprised to learn that people actually lived, and lived quite well, long before the invention of these modern "conveniences". If you can’t cut all of these services, consider trimming at least 50% of them from your budget (or reducing service levels). I have basic cable and no cell phone, and my life is quite fine, thank you (and probably more interesting than the fellow who has all the cable channels).3. Buy a car and keep it. The most economical way to buy a car is to buy a late model used car with low milage, secondhand. Try to find one from the original owner (perhaps some poor slob who got laid off!) with all the service records, garage kept, and in great shape. If you don’t do your own car work, find a good independent mechanic and spend the money to keep the car in top shape. A well-made car should easily last 10 years or more, which should be about the time you start thinking of buying another one. The biggest waste of money I see the average salary slave make is to lease a new car every 2-3 years. This is the most costly way to own a car, and for the amount of money involved, you don’t end up owning anything. People will try to justify leasing by arguing that it saves on repair costs. But a well maintained car requires quite little in repairs. And the repair costs are going to be far less than lease and insurance payments.4. Stop buying "STUFF": The average suburban salary slave has a two car garage, but never parks his cars in there. Why? Because it is chock full of CRAP. Americans are addicted to buying. I have several friends who have filled their houses with junk and live like paupers on six-figure incomes. How does this happen? Consumerism has run wild in America, and we are encouraged to buy more and more useless things that we really don’t need. Many of these things are small items, which seem like inexpensive and thus inconsequential purchases that can be easily put on a credit card. However, what ends up happening, once the consumer gets home, is that this junk never gets used (or used properly) and thus ends up in the garage, basement, or spare bedroom. Big offenders here include weight lifting or exercise equipment, small appliances, and clothes. If you are fat and out of shape, walking a mile a day and eating less will correct the problem – for free. Spending hundreds of dollars on a treadmill or some low-fat cooker (so you can eat your way to slimness) is foolhardy. Similarly, "going shopping" to malls and stores without having any specific NEED for any new merchandise is one sure way to max out those credit cards and fill your home with junk.5. Have a Garage Sale: In that vein, one way to correct this problem is to get rid of junk. Have a garage sale, or sell off your junk on eBay. I have a garage sale (or participate in a neighbor’s) at least twice a year. Things that lie about your house are of no use to you and clutter your life. Get rid of them. If you haven’t used something in 6 months and have no bona fide intent to use it in the next 6 months, SELL IT. This applies especially to big-ticket items like hobby cars, motorcycles, RV’s, boats, jet skis, and the like. People hang onto JUNK out of pride. Sell it now while you can still get something for it.6. SAVE for big-ticket items: Americans love their mini-mansions, but most of them are completely unfurnished. Why? I already gave the answer above. People can "afford" small junky things but can’t afford big-ticket items like quality furniture. As a result, they fill their mini-mansions with cartons of junk, but not the quality furniture you’d expect in large homes. Rather than spend lots and lots of money on small junky appliances and clothes, save your cash for good quality furniture. Avoid going further into debt by buying cheap, flashy furniture at those stores that advertise all the time on TV.7. Have a SAVINGS PLAN: In addition to your retirement plan, you should take steps to build up reserves of after-tax cash. If you can start saving, you can afford to pay CASH for a good secondhand car, or that Stickley sofa you’ve always wanted. If you spend all your money on credit card payments, you’ll be stuck buying junk all your life and paying top dollar for it. There are many, many ways to accumulate cash. Have money deducted from your paycheck for the payroll savings plan (also available online to deduct from your checking account). Have money automatically deducted from your checking account every month to buy stocks, bonds, or go into a money market. Squirrel away cash into accounts that are not easy to get at. I put $100 a month into a Credit Unit account in Maryland. I have to drive 40 minutes if I want to withdraw cash from there, so it acts as a disincentive to spending. This is a great and painless way to build up wealth over a period of time. Don’t get discouraged when you don’t see results right away! I know myself all too well. If there is cash in the checking account, I spend it. So I try to put money into as many accounts (stocks, bonds, etc.) as possible so that I don’t see that big balance in the checking account, tempting me to spend, spend, spend!