Guest Post #3 from Aaron – Holiday MBTI x Love Languages

Today we have another guest post from Aaron!  He analyzes two of my favorite topics (personality types and love languages!) and provides some interesting insights that are good to keep in mind as the season of shopping is upon us.  Don’t forget to also check out his first and second guest post if you haven’t already.

From Aaron:

Recently Heidi Priebe conducted a survey that asked for participants’ personality types and love languages and found the top love language for each personality type. This article has been making its rounds through social media, and with good reason; the Myers Brigg’s Type Indicator is very popular and the more recent “Love Languages” has been gaining ground.  It’s interesting to see people begin indicating their MBTI in lieu of their horoscope on dating sites. If you don’t know your personality type, you can discover yours with these 64 questions. You can find your love language(s) here.

I took things a step further.

I placed all the results side by side, heat mapped it by personality type and by love language, and searched for correlations and outliers. I began wondering if the population in general leans in a certain direction so I added in % of population for each category.  MBTI population numbers are pulled from the authoritative CAPT.  Love language data was more dispersed, but every poll I found in general had Quality Time at the top, followed by Words of Affirmation, Physical Touch, and Acts of Service in a close middle, and Receiving Gifts at the bottom.

Take a look!

Chart

 

Data

 

Takeaways

 

Artisans have the most extremes. Expressive in their own way.  _S_Ps show up multiple times in the Takeaways.  

I tried slicing and dicing by, for example, all Es, or all INs, but that didn’t give me anything insightful. If you like, feel free to play with the data here.

The biggest takeaway is that it’s ironic that our hyper materialistic society appreciates gifts the least.  Perhaps this is just another telltale sign that Americans overemphasize our careers and wealth. The illusion that if we can simply buy ourselves and others enough gifts we will have loved and felt loved is complete farce. Or is it simply that humans innately require relationships and physical touch? Everyone is so busy these days and we all have so little time.  It’s been often said that with the internet and our smartphones we’re all more connected than ever, but at the same time, more lonely than ever.  Does “feeling lonely in a crowded room” strike a chord?  In this age where we set up dinners a month in advance lest everyone is booked, and a few button clicks gets our Christmas shopping done, gifts, and even acts of service where there is an app for everything from doing your laundry to filling up your gas, are cheap. We all gravitate towards that which the internet and our electronics have stolen away from us and aren’t able to provide, even through instant messaging and video chat–constructive face to face time where we truly connect with one another and affirm our care for each other, sealed with a hug when we say goodbye.  So next time you want to love on someone, simply take a moment, put your phone away, break from outside distractions, and tell them you care.  But if you’re dealing with an ISTP, pick up a coffee for them and give them a hug. =]

Remember what the true meaning of Christmas is. It’s not about gifts, it’s about the relationships: friends, family, and God’s gift of Jesus so we might have a relationship with him.

Merry Christmas everyone.

 

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Guest Post #2 from Aaron – Via Negativa

In Aaron’s second guest post, he shares how he gets rid of his excess stuff and how he maximizes credit card rewards.  Enjoy!

From Aaron:

I hope everyone had a great holiday season! If you’re like many Americans, you probably got a bunch of gifts.  A bunch of stuff.  We all have too much stuff.  The concept of “less is more” in reference to physical goods had always floated around in my mind but just a few days ago Art of Manliness actually came out with an article fleshing out that idea.

From that article, “Via negativa is a Latin phrase used in Christian theology to explain a way of describing God by focusing on what he is not, rather than what he is; understanding Deity’s positive qualities is a task deemed impossible for the finite minds of humans.” The article goes on to list things like bad habits, toxic relationships, and stupid decisions as negatives in your life you should negate.

In my own fiscal interpretation of Via Negativa, I see the benefits as two-fold.  First is the negation of a negative, resulting in a positive.  And second, is the resulting simplification of your stuff which brings peace of mind.  Here are a couple examples:

  • Smoking has got to be one of the most fiscally irresponsible things you can do to yourself.  According to the American Lung Association, the average retail cost of a pack of cigarettes is $5.51, but the cost to society and the state’s economy (and your health) is $18.05 per pack.  PER PACK.  By getting rid of this bad habit you save plenty of cash, time, and most importantly, health.  I’m glad most of my friends don’t smoke.
  • Morning cups of coffee add up real fast, in both dollars and calories.  I know people that get a cup of Starbucks every single day.  At ~$5/cup, 50 weeks of coffee adds up to $1250 a year in post-tax…coffee.  That’s about how much my entire 10 day trip, including flight, accommodation, 5 day hike, food, etc to Peru cost me.  Moreover, once you start adding sugar and creamer, those things pack calories. You need to walk an entire football field length to burn off a single four calorie m&m.  Have fun with the new 180 calorie flat white.
  • Finally, if someone is using self-storage, they quite literally have too much stuff.  I don’t think I need to go into too much detail with this one, but Rick Warren, the pastor of the megachurch Saddleback, who by the way has paid back all his past earnings as a pastor, and now tithes 90% of his earnings, once asked something along the lines of “do you know why I never have to worry about scraping the barnacles off my yacht or where to garage my sports car?  Because I don’t have either of those!”

I’m sure there are plenty of other examples.  Lately I’ve been selling a bunch of stuff on eBay and Amazon.  A bunch of old useless stuff lying around my place that I don’t use anymore that is.  eBay takes a little more effort, but they take a smaller cut.  I like Amazon because you list your items, pack all your junk in a box, ship it to Amazon, and they take of all the warehousing and shipping from thereon out.  They even offer Prime shipping on your items.  Declutter and simplification while making money? Sign me up!

I view holding a bunch of cash, touching cash, and spending cash as bad.  One way to remove this bad (and make money that I teased about in my previous post) is by using credit cards!  Just the other day I had a meal with a friend.  To pay, she pulled out a debit card and upon learning she didn’t own a credit card, I immediately berated her for all the free money she was missing out on! Let me explain.  At minimum, credit cards give you 1% cash back, meaning for every dollar you spend, you get one cent.  If you spend just $15,000 a year for the next 50 years on your credit card, you’ll have spent $750,000.  1% of that is $7,500, tax free! I personally hope to spend a lot more than $750,000 in my entire life.  This is the easiest scenario.  If you’re willing to diversify a bit and spend just a little brain power managing a couple more credit cards, here’s what cashback I get:

  • American Express Blue Cash Preferred: 6% CB on groceries (you can buy giftcards, including Amazon gift cards at the grocery store =P) and 3% on gas
  • USbank Cash+: 5% on two categories of your choice
  • Citi Double Cash: 2% on everything
  • US Airways Dividend Miles: (Shameless plug that I get 10,000 miles for referring someone) 50,000 mile sign-up bonus which is enough for one international round trip flight or two domestic round trips.  There is an $89 annual fee, so simply cancel the card after you get your miles. $89 to fly anywhere in the world? WORTH IT.

There are people out there that go even further with this and manage to pay rent, utilities, etc with their credit cards and other blogs begin talking about time value of money and more complicated things like that.  Try searching “manufactured spending” if you’re interested.  I personally don’t spend too much time doing manufactured spending, but I do always offer to put a group tab on my card and collect cash later.  I get credit card rewards and never need to go to the ATM!

Not only do you earn tax-free dollars and free flights from credit card usage, but it simplifies your record keeping (it’s all electronic, automatic, and often times includes spend-analysis tools), and it reduces your liability!  If you’ve ever lost or had your wallet stolen, that cash is gone.  When you use a credit card to buy things, you don’t have to touch dirty money, and cards often have added benefits like extended warranty, extended return period, price protection (if the price of something drops after you buy it), car rental insurance, and so much more.  If you’re not happy with a purchase, complain to your credit card company; they’ll take care of you.

Via negativa: remove the bad and thus increase your good.

***

Click here to see Aaron’s first guest post!

Real Life Millennial: Aaron

Today we have a guest post from my friend Aaron!  Or A-A-Ron as our group of friends like to call him.  Aaron is another one of my friends who is so passionate and knowledgeable about personal finance that he could easily pass as an expert!  For his first post, he decided to share less about the tips, tricks and hacks that he uses and instead, shares about how he views money in relation to happiness.

From Aaron:

I love putting things in a different frame of reference.

It’s Thanksgiving week so before I get into how to view/save/earn money, let’s take a minute to see what riches we already have.

  • Every time I take out the trash I think to myself “This is awesome.  I have an ‘inside’ where I live. Many people live on the streets or in makeshift housing.  I have trash, which in many places people might be scavenging through to find useful bits.”
  • When my past roommates were messy and I found myself cleaning after them, I would tell myself “Man, I’m lucky to have this opportunity to practice perseverance, patience, and humility.  My future wife will be happier and if that means a few less arguments, great!”
  • Traffic irks me, but when it happens, I remind myself “Many people probably don’t get to experience traffic, let alone drive their own car.  I’m chillaxing and listening to music or an audiobook.” If it’s the summer and I’m really feeling mentally ambitious I’ll push it and realize that some crazy people PAY to sit in this free sauna I’m getting right now!  (Ok that’s maybe a bit of a stretch)

Basically, think positive.  Think different.  Count the blessings you already have.  Reframe your current situation.  After all, Happiness = Reality divided by Expectations, but more on that in a sec.

Today I’m actually not even going to talk about saving or earning money.  If Annie invites me to write a follow-up post(s) I’ll touch on those, but for now, I’d like to simply start with how we should view money; how it should play into our happiness, and how much we’re actually earning/spending.

Are we working for money, or are we working for happiness?  I won’t go so far as to explore what the purpose of life is, but I’m pretty sure we can all agree happiness is more of an end goal for us than to simply accumulate wealth.  Some studies have shown that higher income does bring happiness, but only up to a salary of about $75,000.  Additionally, experiences bring more happiness than possessions.  Here’s even a story of a guy who realized he worked half his life away for money, finally realizing he really screwed up.  Ultimately, money is not the goal.  It’s a tool for us to reach the goal in our proverbial pursuit of happiness.

Money should be seen as a security blanket, a way for us to not need to worry if we’ll have a roof over our heads or food on the table.  Money can’t buy things like time, relationships, health, generosity, youth, and character.  How much is peace of mind worth to you?  I envision having and raising a family to be one of the best experiences life can bring.  Is it more important to provide in excess for your family, or to be part of your family? No one on their deathbeds ever muttered “I wish I made more money.”

These notes are all very quintessential, but when talking about money we can’t ignore the numbers.  One good equation I’ve come across is the following:

happiness

There are two ways to increase happiness. Either lower your expectations, or enhance your reality.  Or do both!  Enhancing reality in a fiscal sense can be working towards that next raise, beginning a healthier lifestyle, or finding ways to improve your character.  When I say “lower your expectations” I don’t mean in a lowly downtrodden sense.  (Tie-in to intro here!) I mean to reframe your outlook on the way you expect things to be in life.  Instead of being happy when the trashcan is finally emptied, only to be disappointed when reality reveals a full trashcan, lower expectations until happiness happens even when the trash can is full.  If every day you rush out the door and hope for less traffic during your commute to work, you only leave room for disappointment when there is traffic as usual.  If however, you leave for work five minutes earlier, expecting there to be traffic, on the off chance you arrive at work early, all is good.

Let’s tie this into some hard numbers. Here’s how I like to see how much I’m really spending/earning.  This isn’t a rule of thumb or anything, just a point of view I find useful when putting earnings and expenses into perspective, and being more realistic about finances.  Assuming one has a salary of $50,000 a year.  After taxes, it’s looking closer to about $40,000 a year.  If you tithe, it’s probably closer to $35,000.  That’s 30% of your income right off the top.  In effect, every $10 meal at a restaurant, including tax and tip, is actually closer to $15 of pre-tax income. (A multiplier of 1.5 of what you’re actually spending!)   When you signed on to that $50,000 job, you expected to have $50,000 to spend.  Right off the bat, you can see how very quickly the reality is that it’s actually closer to $33,000 ($50,000/1.5).  Isn’t that so disappointing?!  With our earnings getting taxed and our spending also getting taxed, the reality of our spending power quickly diminishes.

If we reframe how we see our level of income and calibrate it to be lower (lowering our expected spending power), our reality stays the same, resulting in a higher level of happiness.  “For some reason, even making $50,000 I can only afford this much?!” sounds very different from “$33,000 of effective income totally makes sense for where I am right now!”

I hope you found this insightful and an impetus to your happiness.  Next time I’ll talk about some fun stuff like making at minimum $7,500 from spending money like you normally do, what credit cards I keep in my wallet, and why I withdraw money from an ATM only once a year.

***

Aaron has agreed to write more so expect to see another post from him in December!

Real Life Millennial: Michelle

Because everyone’s personal finance story is different, I thought it might be nice to start featuring some guest posts on this blog so we can all take a peek at how other milliennials manage their finances and maybe pick up a tip or two.  I’m so excited that my friend Michelle from Millennial Career has agreed to share her personal finance journey with us today!  She’s so knowledgeable and on top of her finances that you’d think she does this for a living!

From Michelle:

I was 17 when I got my first job at Coldstone Creamery, making $6.25/hour and singing embarrassing songs to earn tips. During college, I had a few jobs: $8/hour working at the student store, $10/hour as an online tutor, and $12/hour (trying) to sell Hoover vacuum cleaners at Walmart. Despite my side jobs, at one point in my undergrad career, I had less than $350 in my bank account. When I graduated from college 4 years ago, my starting salary was $30k.

Why am I sharing all of this? Because I come from a background where I understand how hard it is to make and manage money. Trust me, I’ve been there. Though I am in much better financial shape than I was 4 years ago, those horrible wages and sad jobs really encouraged me to be smart with my money.  My motivation for studying personal finance was simple: 1) I never want to be in a situation again where I felt helpless or tied down because of my money. With $350 in my bank account, I had a taste of how that felt, and it wasn’t fun. 2) I work pretty damn hard to make money, so I should fix anything that is erroneously chipping it away. 3) True wealth is when your money works for you, not vice versa.  

Over the past few years, I’ve been very disciplined with how I manage and budget my money.  For those just starting out on their financial independence journey or need a kick of motivation, here are my general suggestions.

Take control of your money

You hear of surprising statistics where nearly half of Americans live paycheck to paycheck.  I knew that I didn’t want to be part of the population that lacked financial preparation, nor do I want to be in a situation where my future spouse and I have a strained relationship because of money issues. That lifestyle is way too stressful for me; if I can prevent that from happening, then I will.  I want to feel financially free of debt; I want to treat myself right to certain “luxuries,” take vacations when I want, and not feel guilty for my purchases. If I didn’t have a nest egg (meaning, at least 6 months of living expenses saved up), I knew that the short term materialistic things that I wanted would need to wait. If this sounds like you, be disciplined and pay off your debt; stick to a budget. Stop letting your loan interest grow and start saving for your emergency fund.

Automate Everything

One of my favorite personal finance books is called “I Will Teach You To Be Rich” by Ramit Sethi. He has really powerful behavioral changing techniques, especially when it comes to managing your money. One of his suggestions was to keep separate checking and savings accounts; withdraw money only from your checking account. Transfer your income into a savings account even before you can touch or see the money, and keep your checking account numbers low.  The psychology behind it is unbelievable.

For example, say my employer direct deposits $6000 every month into my checking account.  Before I even get to touch (or see) this $6000, I immediately use that money to pay off my credit cards, pay for rent, contribute to my IRA’s, and transfer healthy amounts of money to my savings account. After paying everything off, let’s say the $6000 decreases to a mere $900 in my checking account. In my head, I freak out about having so little, (because I never touch my savings!) but I know on the backend, I’m taking control of my debt and growing my nest egg. It might sound silly, but try it.

Make your money work for you

I don’t know about you, but I really don’t want to work forever (unless it’s at my own company). Ugh. The thought of having to work for someone from 9-6 for the next 40, 50 or even 60 years sounds absolutely miserable. When I retire, I want to be free to travel with my retirement money, not waiting to cash my next Social Security check. For this reason, I started my personal finance journey early so I can hopefully retire (early) and enjoy life with the money that I worked so hard to earn.  

As you can probably tell, I’m anal about finding ways to keep the money I earn and grow it. What this means is:

  • Being responsible with checking my mint.com and credit card statements for anything that looks out of the ordinary.  Waive out of fees you don’t need to pay (like delinquent credit card payments when you forget)
  • Finding high interest savings accounts where your money grows for just sitting there (ya, rly). I currently use Capital One 360 for ALL my savings (money that I need within the next 5 years) and it’s sits there untouched (because I only withdraw from my checking account, remember). Plus, I get an extra $XX in interest per month.  Pretty sweet.
  • Not having to pay more interest than you need, whether it be on credit cards, car payments, student loans, or personal loans.  If I could save an extra $400 by paying off my loan a bit earlier, then hell yeah.  Paying for interest on your interest sucks and digs you into a deeper hole.
  • Making smart investments with your money. Find a brokerage with low trading fees or funds with low expense ratios. It’s all about dem fees. Plus smart people know to diversify their portfolio, so that it’s not just all in one place.
  • Maxing out your 401K and IRAs, to reduce your taxable income, because you don’t want to owe more money than you need to the government, duh 🙂
  • Understanding that low monthly installments with high interest rates means that you pay more in the long run.  Don’t get shortsighted by shiny low monthly payments, and strive to pay off debt aggressively.
  • Doing your research on what you can write off as a tax deduction. For me, this means taking my taxes to a professional who might know the loopholes better than me, and keeping clean track of what is deductible.

They say money doesn’t grow on trees, but you sure as hell can do your best to water it to make it grow.

Stop trying to keep up with the Joneses

This one is huge. Many people get caught up in this rat race about showing off their latest gadgets, purses, cars, houses, etc. It’s really easy to want to “one-up” others and buy into consumerism.  It’s fine to splurge every once in a while, especially if you’ve been diligent about growing your nest egg and savings, maxing out your 401k, and paying off your debt — but if you are living paycheck to paycheck or have massive amounts of loans, then stop.  Stop trying to impress other people because newsflash: they don’t care. If you’ve ever read “The Millionaire Next Door” by Thomas Stanley, you’ll understand that the wealthy don’t necessarily drive the fanciest cars or rep the most luxurious brands.

There are so many (free) resources out there on how to attain financial freedom, and it’s not impossible. Stay diligent and motivated, and of course, be patient — your future self will thank you.

This guest blog post was written by Millennial Career.  For tips on how to increase your salary, accelerate your career, and hustle in your job search, follow Millennial Career.