What those notices often fail to point out, except in the 4-point italicized font at the bottom of the back of the postcard, is that during the 90 days of no payments they are still accruing interest on your balance. You still owe a debt, and it gets more expensive every day.

This is like telling an overweight person, “Wait 90 days to start that diet, and just eat whatever you want to until then.” At some point, the dieter and the borrower, have to face their battle and start working things off. The problem is, in three months, they now have a bigger problem.

Most of these types of “creative financing” arrangements are offered to consumers who refuse to face one single reality – they can’t afford to buy whatever is being offered. That’s it; you can’t afford it. If you don’t have the cash to pay for something outright, or when the bill comes due at the end of the month, you simply cannot afford to buy it.

Alternatives to “No Payment for 90 Days” Offers

Save Money. Open a savings account if you don’t already have one and get started saving towards the item you would like to purchase. In 90 days, you will either have enough money saved, or decide the item isn’t worth three months of your savings.

Be Content. Let’s face it, most “No Payment for 90 Days” offers are made on things we can probably live without – new cars, new furniture, new jewelry, big screen televisions, etc. My grocery store doesn’t offer 90 days same as cash on meats and produce. The gas station will not let me start an interest-free tab. So, chances are, whatever it is you are thinking of buying can probably wait.

You can keep sitting on your old sofa (or buy a yard sale sofa, like we did).

You can live with your current television, and if dies, can live without one – lots of people do it.

If your car dies, buy a cheap one and save up the money to buy a more expensive one with cash down the road.

Of course, it is much easier to walk into a showroom and pick out something brand new with a big price tag and a financing agreement to go with it. But remember, by delaying the inevitable bill all you are doing is tying up future earnings in debt payments.

Who knows what your life might be like 90 days from now? Could you survive getting laid off? What if you get sick, or a loved one falls ill? What if your car dies the week after your big screen television arrives. Trust me; these things happen.

I’m not advocating you sit around and consider the worst case scenario, but I am advocating a practical approach to managing your finances and acquiring new stuff. If the aforementioned things do happen, you’ll be better off minus a bunch of debt payments on things you don’t own.

Pride of Ownership Goes Up When You Actually Own It

Here lately, I’ve taken a hard look at the things I own. Do they bring me joy? Do they add quality to my life? I find that the things that were acquired with my own money, not with debt or a gimmicky financing arrangement, often bring me the greatest joy. Why? Because I don’t resent them, like I used to resent a financed Silverado, and a bedroom suite purchased on a credit card.

When I make the conscious decision to part ways with my money in exchange for some item, I want to own it as soon as I leave the store. This way I can enjoy it for its intended purpose without worrying over how much it cost, or how I will afford the monthly payments.

When it somes to stuff, own it or get rid of it. That’s my only two options from here on out.

Of course, I cherish these stories and the time spent with my grandparents because they made me the “frugal dad” I am today. When I find myself drooling over a new gadget I think back to stories of my great-grandmother searching the cupboards for a missing dime that meant a can of soup for her kids’ dinner. It puts life in perspective to remember that people did manage to get by without today’s modern conveniences.

Don’t get me wrong – this is not an indictment of today’s modern conveniences, because frankly, many of them make life much more enjoyable. However, we should be reminded that many of these things are luxuries, not necessities, even though media and peer pressure would have us believe otherwise.

15 Things Our Grandparents Lived Without (and We Probably Could, Too)

1. GPS Devices.For me, the jury is still out on GPS devices for your car. I hear about more people arriving late because they took the “GPS directions” than I hear success stories. I don’t know what’s wrong with a road atlas – I just bought a new one from Sams Club for a few dollars. Besides, some of the best discoveries are found when you are lost.

2. Tanning Bed Salons. Direct quote from my grandfather: “Why pay hard-earned money to cook your skin when the good Lord shines a sun over your head that does the same for free?” 

3. Cell Phones. Yes, people can live without a cell phone. In fact, many still do, as hard as that is to imagine. If you are concerned with safety while traveling, consider a prepaid phone and keep it charged. Heck, even a cell phone without a calling plan, but a charged battery, can call 911 in an emergency. While I do consider cell phones more of a utility these days, I consider data plans and all the bells and whistles a luxury. Disclosure: I own a DroidX, and curse the bill every time it hits the mailbox!

4. Microwaves. I’ve yet to taste anything out of a microwave that tastes as good or better than stove-top or grilled. Still, it’s a time saver, and since we all have so little of it these days I suppose it helps.

5. Credit Cards/Debit Cards. The concept of borrowing has been around for centuries, but it has only evolved into plastic over the last century. Speaking of plastic, my grandfather didn’t use an ATM card until he was in his 70?s, instead he always went inside the bank, walked up to the teller, and did business ”eye-to-eye.” They knew him by name and were always happy to help with customer service issues he ran across over the 40 years he banked with this particular bank.

6. Electronic Book Readers (Kindle). Why spend money on something with a screen the size of a book when you could simply…read a book. They even let you borrow them for a couple weeks at libraries for free. Yes, I know toys like the Kindle do other stuff, but its primary role is an electronic book reader. Disclosure: I purchased a Kindle in the hopes it would make me read more. Truthfully, it did not, and do miss the smell of an old book. Guess I’ll be re-gifting it.

7. Digital Cable. Even I can remember growing up with only a handful of channels from rabbit ears on top of the television. My grandfather could remember times before television! Imagine getting all of your news and entertainment from a radio, instead of Fox News and MTV. Speaking of MTV – didn’t that used to stand for “music” television?

8. Health Insurance. If our grandparents got sick, I mean bad sick (not a simple cold or poison ivy), they went to the doct0r and paid for their services. The first “health insurance” plans only covered long hospitalizations or major illnesses, not the routine things we see doctors for today. However, one could certainly make the argument preventative medicine has helped us live longer, healthier lives, and much of that is made more affordable thanks to health insurance plans.

9. Plasma Televisions. Up until 2004 my grandfather owned a decades old, 27-inch floor model console television.  He eventually got rid of it when the picture began to have problems around the edges, and now has a basic 19-inch screen on a shelf. When I asked him about a plasma screen once he said, “There is nothing wrong with the picture on my screen now. Besides, I’ve heard those ‘plasma things’ cost as much as a small car.” Indeed, although it had been a while since he priced a small car!

10. SiriusXM Radio. Why pay to listen to something that is available for free over the airwaves? I did get an XM satellite receiver for my grandfather’s car to use on trips, and he found one feature worth paying for – not having to listen to commercials. Unfortunately, this is not true today as I’ve heard commercials have made their way into satellite programming.

11. Xbox, Playstation and Wii. I remember one Christmas while staying with my grandparents I got an Atari 2600 game system. I hooked it up to the television and ran through games like Combat, Frogger and Pole Position. He thought it was interesting enough, but those little game cartridges sure were expensive! Imagine what he’d think about today’s game prices!

12. Health Clubs. Why pay $30 a month to pick up heavy weights and walk on a belt that runs underneath your feet? You can get the same workout walking outside, lifting things in the garden or filled milk jugs, using your own body weight, etc.

13. Calculators and electronic cash registers. People knew how to perform basic math computations and make change. Enough said.

14. Student Loans. Student loans are also a relatively new (I mean, last 50 years or so) phenomenon. People used to simply pay for college, but that was before the days of college tuition costing an arm and a leg. Which begs the question: Has the federal student loan program encouraged colleges to increase costs by allowing students to spread payments out over a quarter of their lifetimes? Reminds me of what happened to housing prices when more and more previously disqualified people were allowed to borrow big money on mortgages.

15. Disposable Items. Ziploc bags didn’t really hit the market until the 1960s, although some “resealable bags” were around a decade earlier. My grandparents used to put things in containers (jars, dishes, etc.) and store them. When they used the item, they washed the container and reused.

“What is the purpose of this?”

Those are the six words. There you have it.

Next time you want to spend money on anything, ask yourself this question first.  I guarantee that if you do, your investing/spending intelligence will expand so much that you’ll put Einstein to shame.

This brainstorm didn’t come to me overnight.  As you’ll see, I developed it over many years of extremely painful research. But make no mistake.  This wisdom is powerful and transformative.

You might chuckle, but the idea came to me after sitting through countess Bar and Bat Mitzvah “celebrations”.

For those of you who don’t live in New York, Los Angeles or Miami, this is a celebration of a 12 or 13 year old Jewish child coming of age.  Usually, the parents throw an extravagant and ridiculous party for said offspring. The price tag for one of these shin-digs usually eclipses that of an automobile.  If you’re lucky – like me – it’s a used Kia.  If you aren’t so lucky, it’s a brand new Lamborghini.

I have 3 daughters and I’ve suffered through dozens of these very loud parties.

What happens is, all your kid’s friends’ parents invite you to the parties and you almost have to go.  It wasn’t so bad after my eldest put us through this grinder with all her friends’ parties.

But I have 3 daughters….remember?

It reminds me of  Michael Corleone’s famous quote, “Just when I thought I was out they pulled me back in.”

When my second child hit age 12 she put us back at the beginning of this process again.  Oh the humanity!

Don’t get me wrong.  I enjoy a good party as much as the next fellow.  Loud music doesn’t bother me all that much – even when the kids do the Macarena or “the Chicken Dance” to Madonna or Britney Spears at 200 decibels.

What I find intolerable is mindless extravagance and often times that’s what these events are.

Each of these parties was a replica of the other.  Sometimes I forgot which party I was at.  They were all exactly the same.  Same food.  Same games.  Same schtick.  Very very forgettable..

I can guarantee you, that if the parents who threw these parties had asked ,”What is the purpose of this?” they would have saved themselves a bundle and enjoyed a more meaningful celebration with their children.

If you’re completely honest, there is really only one reason why people spend the kind of money they do on weddings and Bar Mitzvahs.  They do it because everyone else does.

Sorry.

For me, that’s not a good enough reason to mortgage my right kidney.

If you want to celebrate a child’s coming of age, do something meaningful rather than mindless.

If you want to celebrate the joining of two people into one couple, follow the same advice.

The best way to insure that what you do is indeed meaningful is to ask yourself, “What is the purpose of this”.

Of course, you don’t have to wait for your two-year old’s Bar Mitzvah or wedding to start profiting from this concept.

Ask yourself the same question before you buy your next car or carton of milk.

This probably makes perfect sense to you but you may still encounter one or two problems when you try to implement it.

The first problem could be your spouse or life partner.  The second problem may be your children.

Let’s consider the later first because it’s a much easier hurdle to clear.

Let’s say your kids try to convince you they need one of the following:

1. A gold-plated, ivy-league undergraduate degree in history when you could save 75% by going to a state school.
2. A wedding that cost more than a Greek Island when they could have a wonderful and beautiful celebration in your backyard.

Whip out your 6 word Spend-0-Slayer and ask them, “What is the purpose of this?”

They might explain why they need a degree or a wedding but they won’t be able to justify why they need the priciest version of each.

This is where the rubber meets the road.  This is where the corn leaves the husk.

Ask them “What is the purpose of the costlier version when the lower cost version seems to give you what you need?”

If your kids have watched too much “Law and Order”, they may be able to make a case.

Sometimes, the more expensive choice is indeed a better decision.

For example, if your six year old has outgrown her bike and really wants the spanky new red one with the streamers coming out the handle bars…..you might want to go for it.

Depending on the circumstances, it could be a small investment that will pay huge dividends in terms of self-esteem for your daughter.

But everyone has a limit.  I don’t think that spending $25,000 on a party for a kid who can’t even shave yet makes sense.  I also don’t think that spending that much (and more) on a wedding is particularly clever.  Tell you what…..if your child is having a Bar Mitzvah or wedding and you want to spend some dough to help build their self-esteem…..spring for the spanky red bike with the streamers.  That should do the trick.

If your child wants you to spend a ridiculous amount of money foolishly, look at this as a teachable moment.  Don’t tell them what you already know. Keep asking them the magic 6 words until they admit that they want what they want because everyone else has one or does it that way.

An undergraduate degree is meant to help you get a job so you can support yourself.

A wedding is meant to celebrate marriage.

None of these are meant to impress other people but that’s what many of us use them for. Explain to the kids that by making the more expensive choice, they may actually have less of what they ultimately want.  You’ll only get them to see that if you ask the question – what is the purpose of this?

Take the example of the undergraduate degree.  My middle daughter recently graduated high-school and after being accepted at some very pricey schools, we decided as a family that the best choice would be a lower cost state college.  She realized that by agreeing to this, she would graduate college with no debt and some money leftover to help fund an MBA.  She was clear about the purpose of her undergraduate degree – help her get a job or continue on to get her post-grad education.  If she would have gone to a pricey Ivy League school, she’d finish college in debt and with limited choices.

Let’s go on to the second more formidable problem – your spouse.

The best way I can help you deal with this is by way of example.

I wanted to have a small Bat Mitzvah for my daughters but my wife would have none of it.  While we didn’t go nuts, we spent a lot more than I wanted to.  Going back to my car analogy, my wife’s budget for the party was something along the lines of a new Camry and my budget was closer to that a used moped scooter.  We settled on a budget that was closer in line with that of a used-Kia. We compromised.

When it came to the Bat Mitzvah party, the answer to “what is the purpose of this” was clear – make my wife happy… stay out of bankruptcy and divorce court at the same time.

Pick your battles well.  But use the 6 word spend-o-slayer- it may turn out to be your most effective weapon to tame the extravagance beast.