With NCAA College Basketball’s March Madness in full swing I thought a post about “Cinderellas” would be particularly appropriate. I’m not referring to Cinderella the step-daughter turned Disney princess, I am referring to a dark-horse team, usually from a small conference, that knocks off the top seeds to make a run at the Final Four. It’s happened a few times, and when it does the team is instantly branded a “Cinderella” after the inspiring climb from obscurity to instant fame.

There are no Cinderellas. Some teams take offense to being called a Cinderella, because they felt they had just as much shot at the title as the other guys. The label is frequently used to slight their accomplishments by insinuating “they got lucky.” Sometimes luck plays a part in it, but most Cinderellas pull off the upset because they out-worked, out-hustled, out-coached, and out-played their opponent. The pinnacle moment in their sports careers comes as a result of hours of preparation, workouts, shoot-arounds, two-a-days, and film study.

How does this apply to finances? Many of the wealthiest people in our country are also some of the most envied. Sure, we all would like to be Bill Gates for a day, but why do so many people speak ill of successful people like Gates? Is it jealousy? Or is it the realization that they don’t have the fortitude, the work ethic, the determination to be as successful as those in the wealthy class.

“I guess it is easy if you receive an inheritance.” Believe it or not, most millionaires are self-made, first-generation rich. They do not stand to inherit a large sum of money ala Paris Hilton. They did not strike it rich in the lottery, or win a giant lawsuit. They worked every single day for many, many years at their craft. They built multi-million dollar businesses from card tables in their living rooms and heads full of ideas. They led large corporations of hundreds of employees. They spent hundreds of hours writing, editing and marketing their book ideas to anyone who would listen. These millionaires did not become overnight successes.

How can you become a financial “Cinderella?”

• Get out of debt, for starters. Carrying around debt is like trying to climb Mt. Everest with a fifty pound anvil tied to your back.

• Turn off the television and read to learn something. Knowing the last five winners of Survivor won’t make you a success, but studying these five winners will: Warren Buffett, Donald Trump, Zig Ziglar, Dave Ramsey, and Dale Carnegie.

• Stop trying to impress people at red lights you will never meet again. The average new car payment in America is $475 a month. Sell that sporty new car, buy an old, reliable, used car with cash and drive it until the wheels fall off. Keep driving used cars the remainder of your life and deposit $475 into a mutual fund every single month. In thirty years you will have over $1 million dollars. Don’t believe me? See for yourself.

• Don’t mortgage away your future. Stay well under the 28/36 suggested debt-to-income and payments-to-income ratios (suggested by the lending industry, primarily). I personally wouldn’t tie up more than 20% of my take-home pay in housing. Doing so would mean less to save and invest, and that’s a trade off I’m not willing to make to score extra square footage.

• Practice frugality in all areas of your life. Buy clothes on sale; and only when you need them. Avoid paying for name brands when quality alternatives, or homemade solutions, exist. Be a frugal grocery shopper. Eat at home; it is healthier and less expensive. Invest in yourself; you will live longer and pay less for it in medical bills and insurance premiums.

Finally, after a couple decades of sacrifice, determination, and dedication you could become an overnight success, and be called a financial “Cinderella” yourself. Do not take offense, because you can proudly reflect on the effort you invested to reach your financial goals.

Watch the commercial that inspired this post: There Are No Cinderellas

What is the first word that comes to mind when I say the word frugal. Cheap? If so, you are not alone. Most people tend to incorrectly associate being frugal with being cheap, when in fact they are two entirely different ways of looking at financial life. Dictionary.com defines frugal as “prudently saving or sparing; not wasteful.” The same online dictionary service defines cheap as “stingy; miserly.” But the differences don’t stop with the words’ definitions. Frugal people spend, give and consume a little differently than their”cheaper” counterparts.

Followers of frugality generally believe in being lightweight consumers of resources, whatever those resources may be. For instance, many frugal people prefer to make meals from scratch rather than paying several times for the cost of equivalent foods at a restaurant. Cheap people also frequently look for deals, but still could be heavy consumers of resources. Many cheap people will buy things on sale just because they are on sale, not because they really need them. Frugal individuals hunt for sales, too, but buy only enough to live on for the immediate future.

Need more evidence? I’ll use myself as an example. I appreciate value in a product, even if it costs more than a cheaper alternative. My time is important to me, so I’ll pay a little more for convenience items in a pinch, or shop at a nearby store to reduce the commute time to drive to another area just to save a couple dollars. I recognize good service, and am willing to tip extra to show my appreciation when I receive it. In fact, I typically leave minimum 20% tips when we dine out and receive exceptional service. After all, we don’t eat out that often, and the two or three dollar difference in 10% and 20% doesn’t change my world much, but it may mean the world to our server. I enjoy giving to help family members, friends and strangers. In fact, one of my life goals is to become so wealthy that I can play Secret Santa and give a lot of it away.

The typical cheap person generally displays the polar opposite qualities. When it comes to shopping, many cheapskates will drive all over town to save a few cents on a gallon gasoline, or a loaf of bread. These types will pass up sales on quality products because the final price is still higher than the cheaper alternative. Many would never consider tipping anything above the 10% rule, even if it meant counting out the $3.90 on a $39 bill - come folks, round up and live a little!

The one thing I have found that frugal folks have in common with cheap folks is there willingness to give, however they typically do it in different ways. Frugal individuals enjoy making monetary donations for causes they believe in, while their cheaper counterparts prefer to donate non-monetary gifts such as their time, their services, etc. Both types of givers are required for most charitable programs to be successful, so there is a place for each type, and I’m certainly not discounting the good deeds others have done without shelling out cash.

I honestly believe there is a little of each category in all of us (by “us” I mean those minding their money). I encourage you to think about ways you may be perceived as “cheap” and move towards frugality. I should take my own advice here and stop trying to buy the 1000-count cheapo napkins at wholesale clubs that my wife insists could double for sand paper. I think I’ll make her day and show up with a few packs of Bounty napkins next time I’m out (I have two coupons!).

I finally caught up on my TiVo recordings over the weekend. I watch exactly two television shows now, Lost and CSI. With Lost now going on an extended break, and CSI still gearing up for new episodes, I decided to record some new shows and give them a try. Oprah’s Big Give seemed to be a show I would like based on its premise of giving away money for good causes. It looked to me to be sort of a reality show for Secret Santas.

The first two episodes were about what I expected, but as the stakes were raised and the dollar amounts increased, I became more disappointed with each new show. In the March 23 airing contestants were asked to give away $100,000 in twenty-four hours. The stipulations were you could not give away more than $500 to any one person, or $10,000 at any one location, and you could not simply give away cash.

I was surprised when none of the contestants visited local churches, hospitals or social services offices. These seemed like obvious places to look for people who are hurting, emotionally, physically and/or financially. Most churches have a long list for their benevolence funds, and not all of them are requests for cash money. Many families need help making a car payment, or getting their mortgage caught up just to get back on track. Others may be recovering from a serious illness and are buried in medical bills, or have experienced a disaster such as a house fire or flood and have lost all of their belongings.

Many municipalities are closing city pools and recreational facilities because of a lack of funding and dilapidated equipment. I can just imagine a local Boys or Girls Clubs in Miami would have loved to have received a new basketball goal, or other updated recreational equipment for their facilities. Orphanages are frequently in need of linens and meal supplies to care for young people in their charge. Soup kitchens and shelters struggle to keep staples such as flour, bread, meats and rice in stock. There is no shortage of stories of victims of Hurricane Andrew still living in homes in need of repair, fifteen years after the hurricane blew through Miami. $10,000 would have gone a long way at each of these places.

Instead, some contestants bought groceries for random shoppers, gave away flowers at an intersection ($2,000 worth), and donated pet food and supplies to an animal shelter. These were all noble deeds, but I thought the name of this game was Big Give! These contestants were guilty of thinking small.

I was once part of a corporate initiative to implement a process improvement plan throughout the company. Our trainer had us perform an exercise in the very beginning of the 6-week training course called “think BIG.” Basically, each team was given an idea and told to expound on it as many times as we could in ten minutes. My group received the task, “Start a youth sports program - your existing budget is $0.00.” We started frantically throwing out ideas and capturing them on a worksheet. Separating each line on the worksheet were the words, “think BIGGER!”

After completing ten or eleven lines we had a strategy to start a youth football league sponsored by area businesses and local sports teams. A new stadium would be built using a combination of public and private, corporate-sponsored funds. Concession sales and banner advertisements lining the playing fields would pay for ongoing maintenance. Not bad for ten minutes of brainstorming. However, if the words “think BIGGER” had not appeared under each idea we might have stopped with “sell Krispy Kreme donuts to raise some money.”

Most people stop thinking big somewhere along the way. We all settle into our lives and outgrow those big dreams we had as a kid. I’d encourage anyone reading this to “think BIGGER” when imagining what we could do collectively to help other people. It’s easy to sit in my living room and play armchair quarterback, but I would like to think if I had a chance to give away $100,000 to people in need I could find more worthy recipients.

Image Credit: Daily News

The latest Carnival of Debt Reduction is up and running over at Debt Reduction Formula.  My thanks to Ryan for hosting the carnival, and for selecting my article as an “Editor’s Pick.”  Check out the other great reads if you have some time.

Spring break is almost upon us. Ahhh, the warm sun, the wind in your hair, the cool sand under your feet, I can almost taste the salt water. Too bad I don’t live next to the beach! No, the frugal family will be spending this spring break vacation at home. For us, it doesn’t make sense to shell out for a big vacation when we are working to become debt free. Hopefully, by this time next year we’ll be able to celebrate with a debt free vacation paid for in cash! Until then, we’ll be thinking up some activities to keep the kids occupied during the week-long spring break from school.

Here are a few ideas we came up with:

Monday: Cooking Classes. What kid doesn’t enjoy cooking things from scratch? Spend the weekend brainstorming some ideas and gathering recipes and ingredients. Pick up some used aprons and let the kids decorate them with decorative glue and bedazzles (my daughter claims these are fun). If you really want to impress us frugal dads bake a goodie or two from our favorites list and surprise us when we get home from work.

Tuesday: Matinée Movie Day. Time to get in your pajamas, drag out the sleeping bags and hunt down your favorite movie. If you need a broader selection of movies, check out your local library. Many libraries have a great collection of classics, and a few newer releases as well. Our family loves to gather around a movie on Friday nights with some homemade popcorn. It is even more fun in the middle of a weekday! If you decide to hit the movie theaters, call around first. Many theater chains offer $1 movie matinées when the kids are out of school.

Wednesday: Giant Puzzle Day. When I was in elementary school I had to have my leg in a cast for several weeks. I rode the bus home and my grandmother met me at our house to help with a giant jigsaw puzzle. It was just about the only activity I felt like doing after a day of school on crutches. I looked forward to spending time with her every afternoon as we solved that puzzle. Consider picking up a puzzle that can be accomplished in a half a day or so (anything longer and the kids will lose interest). When you have solved the giant jigsaw use puzzle glue to hold it together and pick up an inexpensive matching frame. Hang the new masterpiece in a kid’s room to remind them of the fun way you spent your spring break.

Thursday: Make a “Mini-Me.” Our school’s girl scout troop did this around the first of the school year, and I thought it was so much fun we are planning to duplicate it over spring break. The only supplies you will need to buy is a small roll of butcher paper (unless you just happen to have some at home). Check discount/outlet paper stores or party supply stores for the paper. For younger kids you may be able to substitute a piece of poster board, or large construction paper. Round up all the crayons, pencils and markers in the house. Roll out the butcher paper and have each child lay down on directly on the paper. Take care not to slide around too much or you will wrinkle the paper. Have a parent, or a brother or sister, trace all the way around the child to create a complete outline - head to toe. Next, using crayons and markers try to decorate your “mini-me” drawing with matching clothes and cut out your finished product. Tape it to the back of your kids door, or on a closet door as a fun reminder. The drawing also serves as a measuring stick to compare your child’s height over time.

Friday: Pretend You are a Tourist (in your own town). It is always amazing how much you can find to do if you just look in your own backyard. Sure, it’s fun to load up the SUV and drive a couple hundred miles to put distance between you and the distractions of home. However, if you are trying to get out of debt or build an emergency fund, taking a trip requires associated travel expenses, hotel stays, and expensive meals at restaurants. Contact your local visitor’s center and ask about area attractions, or stop by and pick up some brochures. Chances are there are plenty of museums, landmarks and parks all within a short drive of your home. It is also likely you have yet to visit them all (I’m guilty of this myself).

Saturday: Put the Kids on Commission. After being inside all week Saturday mornings are a great time to teach your kids the value of a day’s work (or a half-day). I don’t believe in allowances, so my kids are on commission. If they work, they get paid. If they don’t work, they don’t get paid. I know, what a concept. Getting the same allowance every week whether or not you do anything to earn it sounds too much like welfare to me, and I don’t want my kids expecting that every week. Find some safe, age-appropriate chores for the kids to do around the house such as raking leaves, watering plants, dusting furniture, vacuuming, or washing the family vehicle. Teenagers can do things like mow the lawn or help with landscaping chores such as mulching flower beds or putting down new sod. Schedule these kinds of projects around a spring break and make it a family affair. You’ll get some extra help, and your kids will earn a little pocket money.

What are your plans for spring break this year?

Image Credit: markymarko, PPDIGITAL, bucklava, plindberg, Bob Jagendorf, terren in Virginia