Ramit Sethi is the man behind I Will Teach You To Be Rich, a personal finance blog and book that is considered “controversial” by the mostly conservative personal finance community.  Despite the poor branding that makes the site look like some kind of money scam, Sethi is actually a brilliant guy. The premise behind it all is that you can save money by making your own soap or cutting out lattes, but it isn’t going to make you rich.  You need to focus on negotiating debt with creditors, increasing your income, and smart investing.  These are all personal finance topics I can get behind.

Sethi wrote this week about frugality.  He cites an article that talks about the greening of our society.  The argument is that things like CFL bulbs or building your own garden don’t really exist to save the world.  They exist because you feel guilty about how you impact the environment.  As such, focusing on feeling less guilty distracts you from the actual goal of saving the planet.  Sethi associates this to the whole frugality movement.  Like a CFL, making your own soap will actually give you the desired outcome, reduced pollution and money saved on soap.  However it isn’t going to get to the desired long-term goal of sustainable energy or early retirement.  I’m not big on quoting people unless it’s funny, but Sethi expresses my feelings perfectly:

“you can’t out-frugal your way to rich”

Frugal fanatics have a wealth (yes pun intended) of arguments against people like Sethi and many of them have merit.  However you frugal people are a minority and most of us are more concerned with growing our net worth than pinching pennies.  The frugal thing is great here and there, but ultimately if you don’t make your primary focus maximizing the growth of your bottom line you’re not really doing this because of money.

Anywho, here’s the best of the rest I read this week:

Darwin’s Finance proposes a strategy that would essentially make th cost of gas meaningless.  You can buy investments that move with the price of gas in oil nullifying the pain you feel in prices go up.  Say you bought oil futures, if the price of gas goes up it’s probably because oil did.  Sure you’re paying more at the pump but you also made money from your investment.  I’ve played with this idea before, but have written it off because transaction costs would bury you.

TIE from The Finance Buff put together a good list of all the different economic commentary going on about inflation.  If you’ll remember yesterday I spoke about all the coverage, this is it.  I’m thankful for TIE because he’s compiled a large enough list to assign a “who’s right and who’s wrong” list sometime in the future.  If you’re going to base your career on being so sure about the economic future, folks like TIE and myself will be there to make sure you get the applause for being right or the ridicule and defamation for being wrong.

Money Relationship provided a list of various methods you can use your volunteerism to pay down your student loans.  Now many of these you’ve probably heard of in some capcaity.  But there is a new program being piloted in a few cities when if you volunteer your time to certain charities you get $15-$20 and hour tax free for paying down you student loans.  If I had student loans and this was in my town I’d be all over it.  Check out the full list and see if something is there for you (if you still have loans).

Tabitha of From Single To Married wrote a post that has nothing to do with personal finance.  That’s fine with me, because she makes me laugh audibly when I’m reading, which aside from Dave Barry, is next to impossible.  Check out her story about finding something on her dog after he got a hair cut.

Also, don’t miss the Carnival of Personal Finance at Living Almost Large

Photo: dancingwithwords

By The Weakonomist

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