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Pradyot Sharma Staff Writer The Troy University Board of Trustees approved a five percent increase in tuition for the 2017-18 academic year. Undergraduate tuition was raised $15 from $301 per credit hour to $316 per credit hour and graduate tuition increased by $20 from $397 to $417 per credit hour.  There will also be a $3 increase in University general fees raising it to $42 per credit hour. According to Jim Bookout, the senior vice-chancellor for financial affairs, the main reason for the increase in tuition was the lack of […]

Help your clients beat three classic ‘bad habits’

Courtesy Everett Collection

Stan Laurel, left, and Oliver Hardy in 1940s ”A Chump at Oxford.”

According to a 2017 study from the Employee Benefit Research Institute, only 61 percent of American workers reported having saved retirement, while 56 percent of respondents said they were currently saving for their golden years.

And only 18 percent felt very confident that they were doing a good job preparing for retirement. (Another 38 percent felt “somewhat” confident.)

As a financial planner, this isn’t news to you, though it may be more disappointing for you than most given your line of work. As someone on the front lines of trying to help people understand the value of saving for anything later in life, you know it can be an uphill battle.

Read: Two behaviors that can sink your retirement

Here are a few tools to help you help clients get past some of the standard pitfalls around saving, which use the very science that generates those issues as your weapon. Helping clients understand the reasons they make excuses to avoid saving may give them what they need to overcome these challenges.

‘I don’t have enough money to save’

For some investors, this is a valid excuse. If the money’s not there, it’s not there. For others, however, it may be the type of Catch-22 situation you can attempt to reverse simply by understanding behavioral tendencies.

In other words, the adage telling us that “the more we make, the more we spend,” is actually deeply rooted in behavioral science.

One of the more useful qualities we have as human beings is our ability to quickly adapt to changing circumstances. But some experts, including Baylor University marketing professor James Roberts, believe that our adaptability may hinder us in terms of saving and spending.

Courtesy photo

Dan Martin.

Roberts uses the example of a college student who wants to get out of his or her dorm, then moves into a rental house but gets tired of having roommates, then dreams of a small house, then a bigger house (and on and on from there) to show how our minds can quickly move on to the next step when we attain a goal or desire.

Another reason behind our penchant to overspend and undersave is simply that we may have seen our parents do it and modeled the behavior. In other words, over time, we have fostered and intensified bad habits which, as we all know, can be extremely difficult to break.

Read: You’re sabotaging your retirement without realizing it

Some researchers, however, believe that we have the ability to change almost any habit through repetition via a series of mental processes.

I would recommend the book “The Power of Habit” by Charles Duhigg, which takes a serious look at habit formation and the science behind why we do what we do. Besides the interesting case studies and frameworks, the heart of Duhigg’s theory centers on the importance of simply understanding that habits can be broken:

“Once you understand that habits can change, you have the freedom—and the responsibility — to remake them,” he wrote. “Once you understand that habits can be rebuilt, the power becomes easier to grasp, and the only option left is to get to work.”

Clients may be relieved to hear that the negative behaviors that keep them from saving money are not totally their fault (thanks a lot, science), but an equally important part of the message is that there are ways to fight to overcome these ingrained habits.

‘Retirement is too far in the future’

I was meeting friends at the National Western Stock Show in Denver a few summers ago, and when I arrived, I realized that I hadn’t purchased tickets (and, as a result, probably could have touched the roof from the nosebleed seats I had to grab on-site). My immediate thought was, “How did you not think to do the one thing you needed to do before attending that event?”

According to a recent study, part of the answer (beyond my own struggles in staying organized) may be that I made the plans too far in advance for my brain to plan for that contingency. This story dovetails well with one of the most common excuses for failing to save for retirement — investors just don’t have the wherewithal to plan that far ahead.

If it’s difficult for us to plan for an event a few months down the road, remember that your clients are looking at planning 30 or 40 years into the future.

Read: This is why most people don’t save money for retirement

According to Dale Griffin, associate dean and professor of marketing at the Sauder School of Business at the University of British Columbia, we can look at “temporal construal” and “loss aversion” as potential behavioral biases that make it difficult to make good decisions about our future.

Griffin explains “temporal construal” as the tendency for far-off events to be mentally experienced differently than closer events.

“Events or ideas far off in time are thought of in abstract and general terms, with an unavoidable overlay of optimism,” Griffin wrote in Slate. “Thinking about yourself (or your children) in 40 or 50 years creates a mental image that is akin to pondering a vague, general, overly rosy idea rather than a detailed individual with real problems.”

In the same vein, studies on the theory of “temporal discounting,” or the idea that individuals prefer more modest immediate rewards to larger potential future rewards, have shown that we have trouble seeing future events in clear focus and difficulty in attempting to imagine what our future selves will look and act like.

One can see how these types of mental blocks can affect our ability to take saving for the future seriously in the present.

“Loss aversion,” according to Griffin, is essentially the idea that humans are more likely to think about potential “losses” than potential “gains” in the long term. In other words, we are programmed to be more worried about future debt than what we might “gain” by saving for retirement, which may result in attempting to pay off our mortgages or student loans more quickly at the expense of building a retirement account.

The idea that repetitious activities in the present, such as monthly mortgage or student loan payments, can help our minds focus on making decisions to solve long-term challenges in the present, can offer a glimmer of hope from a savings perspective.

Specifically, the idea that providing ourselves with short-term rewards or benchmarks — instead of trying to visualize a single “number” or long term goal — may be helpful in building a saving habit for the long-term, and can at least provide a place to start.

In addition, these findings may help you help your clients look at the tendency to not save enough with a fresh perspective. Instead of beating themselves up because they failed to meet their savings goal for the third straight month, they could try something more constructive and potentially even fun.

For example, you may recommend that they download one of the many free face-aging apps available for iPhone or Android. AgingBooth and FaceApp are two of the more popular applications that use algorithms and neural-network technologies to show us what we might look like when we’re much older.

Although the accuracy of the imagery is certainly up for debate, I can attest that seeing my face aged years into the future was a disconcerting experience and provided a surprising dose of perspective.

Perhaps these applications will give you a unique opportunity to break through the “temporal discounting” barrier and make the idea of aging more real for your clients. MerillEdge, in partnership with Bank of America, was one of the first to launch this type of application in 2014 (called FaceRetirement); According to Bank of America, 60 percent of the nearly 1 million people who used the app chose to learn more about retirement and beginning to plan for the future.

Or perhaps finding a few easy-to-consume, investor-friendly articles to share with your clients on behavioral science will help provide some useful insights that they just didn’t have before. While we can’t say the same for all financial topics, it is an extremely interesting part of what you do as a planner and has the potential to engage a wider audience.

‘I lost too much in the last crisis’

There are certainly situations where this might be true, and if that’s the case, your client is in good hands working with a planner like you. For many others, especially individuals in younger generations, the statement above is a prime example of the “sunk cost fallacy,” the very same behavior that kept me sitting in the theater during the fourth installment of the “Transformers” franchise instead of walking out after the first 20 minutes.

A “sunk cost” can be defined as any cost (not just monetary, but also time and effort) that has been paid already and cannot be recovered. The “sunk cost fallacy” is an extension of the human behavior of “loss aversion” mentioned above, in that we are programmed to focus more on the costs we have already accrued (and that we can never get back) than the future experience we are putting our time, money or effort toward.

The more we invest in something, the harder it may be to let it go (even if it turns out to be a terrible investment). I’m sure that every one of your clients can think of a time where they continued to stick with something for the sole reason that they had already put a lot of money or effort toward its completion—we all have.

Sometimes that can be a good thing (i.e., finishing a degree, completing a rigorous fitness program, climbing a difficult peak, etc.).

However, the “sunk cost fallacy” can become an issue with saving money, because subconsciously, our minds may be thinking about the money we have lost in the past and urging us to try to get that investment back. This can encourage risk-taking and other behaviors that have the potential to cut into the portfolio your clients have worked so hard to build.

Dan Martin is the director of marketing for the Financial Planning Association. Follow Dan on Twitter @DanW_Martin. This story was first published on the Financial Planning Association’s Practice Management Blog on August 10 2017, and was reprinted with permission.

City hears about more energy savings

The city had an “energy audit” done some years ago, which helped with projects to make City Hall, Ross Library, and Hope Hose Co. more energy-efficient, City Manager Richard W. Marcinkevage said. Last year, City Hall was switched from oil to gas, he added.

The city is now in the process of moving its garage into its newest facility, the former PennDOT building on Second Avenue, and the windows there were replaced for energy savings, Council Vice President Stephen L. Stevenson said.

Lock Haven Mayor William E. Baney III and Marcinkevage also talked about street lighting. The city contracts most of this lighting from PPL, which is in the process of replacing old streetlights with LEDs. PPL also plans to replace the 49 green steel poles in the city, along with the lights atop those poles. The project should result in a savings of $5,000 to $7,000, the city manager said.

The city does own the streetlights it installed as part of its downtown streetscape improvements, and the lights on Main and Water streets are LED, he added.

“Everything we do is the most efficient we can get,” Marcinkevage said.

Councilman Ted Forbes mentioned that he has solar panels on his house and would like to add more.

Richards talked about “deeper savings” such as those available by examining the use of bulk fuels and air-sealing buildings.

She also noted that when a municipality begins to go down the energy-saving road, that sets a tone and encourages nonprofit organizations and private citizens to take their own energy journeys.

She was accompanied by Karen Elias and Vicki Smedley, members of SPARK (Supporting Public Action and Reliable Knowledge), a local community-based advocacy group.

Using less energy is a way to retain more wealth, and using renewable energy can create new economic opportunities, according to a statement from the group.

SPARK proposes a partnership with the city to jointly draft and implement a plan to help the community move toward energy independence. A citizens committee could partner with city government and SEDA-COG to write the plan and educate others about reducing energy use.

New Berlin in Union County formed a Community-wide Energy Independence Initiative and had hundreds of participants over three years. The average participant achieved about a 22 percent reduction in energy use, and the project documented a community-wide savings of $217,000 per year, Richards said. Over five years, that would total more than $1 million for a community of 900 people.

Millheim is in the process of using the New Berlin project as a template, as is Selinsgrove, Richards said. Seven buildings in Selinsgrove — churches, municipal structures, schools, not-for-profits — received a discounted price on energy audits. All have reduced their energy use by 25 percent without even turning to all the audit recommendations yet, she reported.

“The savings are phenomenal,” she said.

This region is behind the rest of the nation in energy reduction, she said, and SEDA-COG would like to move it in that direction.

The Appalachian Regional Commission has been a friend to the region and may be a funding source for a city-wide energy initiative, she suggested.

The mayor floated the idea of windmills on Bald Eagle Mountain, and Richards said Lock Haven University students might be able to chart the wind there as a class project.

SPARK also has volunteers who can do some leg work, Smedley said.

“It all fits together with what you are already doing,” she told council.

Stevenson said, “If we could save money for everybody in town, that would be a good goal.”

Baney said a further meeting with Richards would be a great idea for the city to pursue.


The city’s newest police officer, Wesley Alexander, was sworn in Aug. 7, Marcinkevage reported.

The city’s assistant treasurer, Barbara Waterman, will retire Dec. 6 after more than 20 years of service. Some of the job duties will be changed for the position before the city advertises to hire a replacement, council heard.

The city also will soon advertise for a new city planner, to replace Leonora M. Hannagan who also will retire later this year. Some of those job duties also will be changed before a new planner comes on board.

The position of part-time water clerk is open, Marcinkevage said.


The crowd for the Hybrid Ice concert on the floating stage Aug. 6 contributed $2,095 toward the City Free Summer Concert Series, the mayor reported.

There are two more concerts on the floating stage, he said: The Billy Price Band this coming Saturday and the band Dumm this Sunday. Both start at 6:30 p.m.

He also asked about the outdoor webcam on the levee that had provided a 24/7 video view of the river. The webcam, originally run by KCnet, has been down for months. Baney suggested Comcast might be interested in providing internet service and in helping get it up and running again.

Council approved Rally for Recovery’s request to post a banner over Main Street from Aug. 21 to Sept. 15, for a 5K run/walk.

The city’s application to the Pennsylvania Liquor Control Board for an Underage/Dangerous Drinking Grant was not funded, but the city can try again next year, council heard. The money was to be used for a joint program with Lock Haven University.

The city manager said complaints have been received about questionable images in the windows of a downtown storefront. At least one of the images has been called lewd. The city does not have the authority to have them removed, he told council.

Councilman Ted Forbes called the display “disgusting.”

Creating a Menu Plan to Save on Groceries

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Should We Subsidize Manufacturing?

In the auto-industry bailout of 2009, the United States loaned around
eighty billion dollars to G.M. and Chrysler, saving an estimated one and a half
million jobs. Since then, $70.5 billion has been repaid—meaning that, in
a back-of-the-envelope sense, the federal government managed to save the
auto industry at a cost of just six thousand two hundred dollars per
worker. One of the architects of this unusually efficient intervention
was an investment banker and union negotiator named Ron Bloom. In 2011,
Bloom joined Barack Obama’s newly created Office of Manufacturing
Policy. He drafted position papers and helped launch a program linking
universities with manufacturers. But he was otherwise marooned in his
basement office, powerless to influence more consequential policies on
infrastructure, education, trade, and China.

“Maybe because of the auto bailout and the mood it created,” Bloom tells
Louis Uchitelle, in “Making It: Why Manufacturing Still

(New Press), “there was a little bit of a boomlet in public concern
about the importance of manufacturing.” The boomlet didn’t last. It
collided, Bloom explains, with a hidden consensus in the White House:
“The argument was that manufacturing is dying anyway; let it go.”

To what degree have Democrats given up on the idea of “saving” American
manufacturing? Democratic politicians still wear hardhats and visit
factories, but they never promise to make manufacturing “great again.”
The Trump Administration, on the other hand, has committed itself to the
theory that a resurgent manufacturing sector can solve the crises of
working-class Americans. The contrast was especially vivid earlier this
month, when Terry Gou, the chairman of the Taiwanese electronics giant
Foxconn, appeared at the White House to announce plans to open a
ten-billion-dollar liquid-crystal-display factory in Wisconsin. Foxconn,
which builds the iPhone and other products, promises to hire three
thousand workers by 2020, and says it may eventually employ as many as
thirteen thousand; the deal includes a three-billion-dollar incentives
package and was negotiated by Jared Kushner, House Speaker Paul Ryan,
and Wisconsin’s Governor Scott Walker, among others. Donald Trump took
credit for the deal, too: “If I didn’t get elected, he definitely would
not be spending ten billion dollars,” he said, of Gou.

Almost unanimously, commentators and politicians on the left have
responded to the deal with skepticism bordering on Schadenfreude. They
point out that Foxconn has announced similar deals in the past without
following through; they argue that, even if the factory is built, its
workers may soon be replaced by robots anyway. Most of all, they deride
the massive incentives package—the fourth-largest in American history,
according to the Times—as “corporate welfare.” The package is, in
fact, extraordinarily generous. It includes not just training and
infrastructure grants but also direct subsidies.
According to the Milwaukee Journal Sentinel, “because Wisconsin already waives
almost all taxes on manufacturing profits in the state, these incentives
represent not a lost opportunity at collecting revenue but an obligation
to pay cash.” Payments from the state of Wisconsin to Foxconn may total
as much as two hundred million dollars per year. If only three thousand
jobs are created, that’s sixty thousand dollars per year per job; if the
full thirteen thousand jobs materialize, the figure is still fifteen
thousand dollars annually. “Foxconn will essentially be run by a
workforce paid by Wisconsin taxpayers, while the profits go to Taiwanese
taxpayers at the behest of politicians who cast themselves as champions
of the free market,” Judd Legum, the editor of ThinkProgress,
has written.

The idea of Wisconsin taxpayers making direct payments to the single
largest private employer in China certainly seems odd, and the Wisconsin
state legislature is currently debating the extraordinarily high costs
of the Foxconn incentives package. Meanwhile, for the rest of us, the
deal raises an important question: When do manufacturing subsidies make
sense, and how big should they be?

In “Making It,” Uchitelle, a veteran labor reporter for the Times,
argues that Americans are in denial about the importance and prevalence
of subsidies. Our factories have always been “semipublic institutions”
funded, to a surprising degree, by taxpayer dollars. “The false premise
that manufacturing is a free-market activity—that subsidies don’t exist
or are inconsequential—should finally be put to rest,” Uchitelle writes.
“No one anywhere in the world makes steel or autos or shoes or virtually
anything else in a factory without subsidies.” Uchitelle thinks we ought
to subsidize manufacturing more, and more rationally. We should also
recognize that, when we decide not to subsidize manufacturing, we are
deciding to kill it.

For decades, most Western economists and business scholars have regarded
manufacturing subsidies as an unfortunate, market-distorting fact of
mercantile life, to be tolerated rather than embraced. Recently,
however, there have been signs of a shift, driven by a new appreciation
for manufacturing’s importance to the country as a whole. In their book
Producing Prosperity: Why America Needs a Manufacturing
from 2012, the Harvard Business School professors Gary Pisano and Willy
Shih argued that, because so many useful discoveries emerge during the
manufacturing process, companies that move factories overseas become
less innovative with time. In an article called “It’s Manufacturing’s
Turn for Special Treatment
Pisano asked whether we ought to start boosting manufacturing the same
way we boost agriculture, education, health care, and finance—sectors of
the economy that are heavily subsidized through tax incentives and, in
some cases, direct grants. Other researchers, including Jeff Madrick, of
the New School, point to the importance of America’s shrinking
“industrial base,” and
argue that the strong dollar is itself an “an anti-manufacturing strategy”
which benefits the finance industry while reducing exports. If that’s
the case, perhaps it ought to be balanced out by subsidies to

Still, most researchers stop short of suggesting direct payments to
factory owners, analogous to the ones farmers receive. Instead, they
propose investment in related sectors of the economy, such as education.
Both Democrats and Republicans would rather invest in the system as a
whole—funding job-training programs, for example, or research into
“advanced manufacturing”—than be seen as “picking winners” or “propping
up” individual businesses.

In “Making It,” Uchitelle, the eighty-five-year-old son of a Manhattan
textile broker, argues that this hands-off attitude reflects a broad
misunderstanding of the history and nature of manufacturing. (Uchitelle
spent his childhood visiting the factories of New York’s garment
district and sometimes writes about the history of manufacturing in the
first person.) For much of the twentieth century, he shows, a great deal
of American manufacturing, including automobile manufacturing, happened
in cities and was heavily subsidized by municipal governments. Well into
the middle of the last century, cities gave manufacturers large tax breaks and grants. They
loaned or deeded land to companies for the construction of their
factories; expanded sewer, power, and rail service; and widened streets
so that trucks could get in and out. In the postwar years, some of the
decline in urban manufacturing was inevitable—automobile manufacturers,
for example, needed more space. But many companies left because
municipal governments grew less willing to subsidize them. “The city of
St. Louis wasn’t interested in helping us,” the owner of a heating-unit
manufacturer, which left town in the nineteen-fifties, tells Uchitelle.

The decline of American manufacturing is often described as the
inevitable result of global economic forces, such as cheap labor.
Uchitelle doesn’t deny the power of those forces but insists that the
decline had a social dimension, too. After the Second World War, more
Americans started going to college, and workers with only high-school
educations “came to be seen as underachievers” capable only of
“unskilled labor.” Uchitelle objects to this “shamelessly exclusionary
definition of skill,” which, in his view, implies that college students
with degrees in marketing are more “skilled” than factory workers
capable of operating and repairing heavy machinery. This perception
encouraged voters to overlook the “variety and complexity” of factory
work; as a result, “manufacturers encountered less and less censure”
when they closed factories and moved good jobs overseas.

Uchitelle quotes the sociologist William Julius Wilson, who, in a 1996
book called “When Work
tallied up the job losses due to factory closings in northern cities.
“In the twenty-year period from 1967 to 1987, Philadelphia lost 64
percent of its manufacturing jobs; Chicago lost 60 percent; New York
City, 58 percent; Detroit, 51 percent,” Wilson writes. Urban
African-Americans were disproportionately affected by these closings:
many couldn’t afford to follow the factories out of town, as their white
co-workers did. Uchitelle sees the closure of so many urban factories as
a failure of democracy. City taxpayers had helped pay for those
factories and should have had more to say about the decision to let
them leave. In the event, voters—perhaps because they were ignorant
about the public-private nature of manufacturing, or because they were
disinterested in the fate of the black working class—didn’t protest.

There are cases in which city governments have successfully used
subsidies to keep urban factories open. Uchitelle notes that “all of the
Tums antacid tablets sold in the Western hemisphere” are still
made in a single block
of downtown St. Louis; today, the Brooklyn Navy Yard, a subsidized
manufacturing district in New York City which has received about a
quarter of a billion dollars in public money, is home to dozens of urban
factories. For the most part, though, cities have decided to prioritize
other kinds of subsidies. “Cities such as Cincinnati, Cleveland,
Baltimore, New York, Los Angeles, and St. Louis spend huge sums to
subsidize the construction of sports stadiums or expensive apartment
complexes or medical centers and research institutes, or all of these,
rather than factories,” Uchitelle writes. For decades, these projects
have been hugely lucrative for bankers and real-estate developers, but
the jobs they create tend to be of low quality. Together, New York’s
three recently built stadiums, Citi Field, Yankee Stadium, and the
Barclays Center, received eight hundred and seventy-six million dollars
in federal subsidies, along with even more subsidization from the state
and city—but many of the people working there hold low-wage, part-time
positions such as concessions operator, security guard, or janitor.
Manufacturing, Uchitelle argues, remains “a better means—even the best
means—of enriching cities and lifting the wages of urban workers,”
especially when those workers are unionized.

As manufacturers abandoned big cities, a competitive interstate market
for subsidies sprang up. Today, Uchitelle writes, American manufacturers
receive roughly eighty billion dollars a year from a zero-sum subsidy
competition between states and counties searching for factory jobs. They
also receive seven hundred billion dollars in indirect subsidies from
the Department of Defense, which is required to purchase weapons and
materiel from American factories, and from state, county, and local
governments following “Buy American” regulations. These subsidies are
not inconsiderable—in all, “more than 20 percent of the nation’s factory
output is purchased directly with public money,” he writes—but, in
Uchitelle’s view, they are too small and arbitrarily distributed.
According to a recent report in the Times,
the construction of Foxconn’s iPhone factory in Zhengzhou was
facilitated by more than ten billion dollars in government money, including the
construction of an airport. Those subsidies went hand in hand with the
creation of special import-export rules, and are part of the Chinese
government’s larger strategy to dominate manufacturing in particular
industries, such as computers and solar power.

“Making It” closes with a series of recommendations for how the United
States could implement a more coherent industrial policy. Subsidies
should be increased, and their role emphasized. The dollar should be
devalued to encourage exports and slow the financialization of the
economy. Import tariffs should be raised and trade agreements
renegotiated. Taxpayers should have more say in where factories are
located: similar factories should be built near one another, ideally in
or near densely populated cities, to strengthen the industrial base and
force companies to compete for workers. “Buy American” clauses should be
extended: Uchitelle notes that the glass in the new World Trade Center
was made in China, as was the steel in the new Verrazano-Narrows Bridge.

Uchitelle also suggests that we set a G.D.P. percentage target for
manufacturing. In the nineteen-fifties, twenty-eight per cent of G.D.P.
came from manufacturing; today, it’s twelve, and only Britain and Canada
lag behind the United States in manufacturing output. Uchitelle argues
that a figure of seventeen per cent would put us in line with other
industrialized nations. In Germany, he points out, “manufacturing output
has generated a steady 22 percent of the national income year after year
for at least seventeen years, and the government is quite open about its

Back-to-School Tips that Save Time and Money

MISSION, KS–(Marketwired – Aug 14, 2017) –  (Family Features) Back-to-school season means it’s time to get back to the business of learning. This year you can ace your back-to-school shopping excursion with these time- and money-saving steps that can make getting the whole family ready for a new school year a breeze.

Start with a list. Walking into the store without a list is an open invitation for impulse buys and forgotten items that end up costing you more time and money with a return trip. Create a thorough list by categorizing all the items you’ll shop for, such as supplies, electronics and clothing.

Set a budget. Knowing what you can afford to spend ahead of time can save regret and returns after you shop. Calculate how much you’ll need to cover all the items your students truly need, then tack on some room for wants. One must-have is a high-quality backpack, like the High Sierra Access Backpack, which includes a dedicated storage area for your child’s laptop, among other features. If your total budgeted expenses exceed your available funds, consider browsing weekly circulars to keep your budget in check.

Explore your inventory. It may be buried under a summer’s worth of knick-knacks, but digging out the supplies your child cast aside at the end of the last school year may be worth the effort. Items like scissors, rulers and protractors may not need to be replaced every year if they’re still in working condition. Assess what items you have that can be reused and those that need to be replaced for the new school year.

Cut extra stops. Dashing all over town to find all the items on your supply list is not only time-consuming, it’s unnecessary. At stores like Office Depot and OfficeMax, you can find all the academic tools and supplies your student needs to head back to the classroom. What’s more, a store that specializes in school supplies will have a broad selection and ample stock of the essentials.

Try online shopping. When you know exactly what you need, shopping online is a great time-saving solution. If you need to hand-select a few items in person, you can always take advantage of a “buy online, pick-up in store” option. This service lets you do your shopping from home with just a quick stop in-store to pick-up your purchases.

Buy in bulk. It may seem counter-intuitive when you’re trying to trim your spending, but if you can swing it, go ahead and buy extra items that you’ll likely need to replace mid-year. The sale prices during the back-to-school season aren’t likely to repeat during the school year, so in the long run you’ll save money and avoid a last-minute shopping trip on a busy school night in the future. Items like Stellar fashion notebooks, which give notetaking a fashionable twist, are great to have on hand throughout the school year.

Research specials and promotions. For many stores, the back-to-school shopping season is second only to the holidays. This means you can expect widespread sales, promotions and special deals, such as “deals as low as a penny.” Some states also offer tax-free holidays near the beginning of the school year, which are honored at multiple retailers and generally restricted to school-related purchases like clothing, supplies and some technology.

Take more notes on smart back-to-school shopping ideas and deals at officedepot.com.

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Shark Tank Stars Mark Cuban and Sara Blakely Tell Us How They Got to Their First $1 Million – And How You Can, Too

What does it really take to become a millionaire?

A big, game-changing idea? A high tolerance for risk? An unwavering commitment never to compromise? When we posed these questions to two of the stars from the TV show Shark Tank—Spanx founder Sara Blakely and Dallas Mavericks owner Mark Cuban—these were the types of responses we expected.

Money Magazine  

The reality show, after all, exalts risk-taking entrepreneurs who pitch their visions and startups to a panel of deep-pocketed investors. And Blakely and Cuban each made a fortune through their own big ideas. Blakely’s business gave birth to a new billion-dollar segment of the undergarment industry, and Cuban helped launch Broadcast.com, a pioneering Internet audio and video site sold to Yahoo in 1999 for $5.7 billion.


Instead, Blakely, who in 2012 became the world’s youngest self-made female billionaire according to Forbes, talked up the importance of being frugal, prudent, and even thinking small. And fellow billionaire Cuban discussed the need to be resilient in the face of setbacks. As for risk taking, Cuban says he’s all for it—in the context of investing in low-cost, diversified stock index funds. Huh?

In their conversation, Blakely and Cuban discuss a strategy for building wealth that MONEY has espoused for decades: by saving aggressively, avoiding debt, keeping expenses low, and investing in yourself.

This simple strategy has proved quite successful.

Of course, taking these steps is no guarantee of joining the two-comma club. Becoming a millionaire still requires some luck, pluck, and risk taking. And it never does hurt to dream big.

Sara Blakely and Mark Cuban, two billionaires on ABC’s reality TV show Shark Tank. Blakely: Photograph by Peter Yang for Money; Styling by Renata Popenhagen; Hair and Makeup by Stephanie Daniel; Cuban: Bob D’Amico—ABC 

Mark Cuban: I think it’s possible to have a million dollars in the bank even if you’re not an entrepreneur. There are a lot of strategies for people who work their way up the corporate ladder, or even bounce from job to job.

You’ve got to have discipline in how you spend your money, first of all. When I was getting started, I used to read this book, How to Retire at 35.

NOTE: Cuban is referring to Cashing in on the American Dream: How to Retire at 35, by Paul Terhorst. The book, published in 1988, advised savers to aggressively reduce their housing costs—and to find ways to live on $50 a day.

The whole premise of the book was that if you could save up $1 million and live like a student, you could retire. But you would have to have the discipline of saving. I believed heavily in that book. It was a big motivator for me.

I did things like having five roommates and living off of macaroni and cheese, and I was very, very frugal. I had the worst possible car—those types of things.

Sara Blakely: What kind of car was it, Mark?

Mark Cuban: I had a Fiat X1/9 with a hole in the floorboard. I had a 1966 Buick LeSabre. I mean …

Sara Blakely: Those are real chick magnets.

Mark Cuban: Oh, yeah—big-time chick magnets. I didn’t have a car that cost more than $200 until I was 25, I think. It was crazy. But that was my decision. I was determined to save money. I was determined to be able to retire. It wasn’t like I thought, “Okay, I’m going to be super-rich.” I valued time more than anything. I wanted enough money to be able to travel, have fun, and party like a rock star, but still live like a student. That was my motivation.

Can you save a million dollars? You can, but you really have to be disciplined. You also have to be a little bit of a risk taker. Part of the risk is maybe putting money into a low-cost mutual fund.

NOTE: Investing your savings in stocks is both a risky and safe strategy. The risk, obviously, is tied to potential market losses. However, since equities are among the few investments that can outpace inflation over time, you need to own stocks. To reduce some risk, though, trim the fees you pay by relying mostly on low-cost index funds. Many index funds charge 1/10 the fees of other stock funds, allowing you to preserve more of your nest egg.

Or invest in your education—whatever it may be to help you get to the point where you can truly save money.

Sara Blakely: What I did was start small, think big, and scale fast. I didn’t ever get ahead of myself on spending. I only spent what I absolutely needed to. The Spanx headquarters was my 1,100-square-foot apartment. I used my roommate’s bedroom.

Blakely unpacking Spanx boxes in 2000 in her Clearwater, Fla. apartment. Photo: Michael Schwarz—Tampa Bay Times/Zumapress.com 

Even when I had money to move out of my apartment—even though we were all on top of each other, and it was crazy— I didn’t. For two additional years, that was the headquarters. Then, from there on out, my headquarters were always way below what I could have spent.

I have that mentality on everything. If I can save money here or there, I’ll do it. [Instead of] a very expensive photographer for $5,000 or whatever, I’m gonna go and get a friend and a camera, and we’re going to shoot the pictures ourselves. I feel like that’s a big part of the formula.

Mark Cuban: Absolutely.

Sara Blakely: For me, it’s about being as scrappy as I possibly can. And by the way, I’m still that way. It’s like I can’t get it out of my DNA.

Mark Cuban: You do have to be scrappy. If we weren’t scrappy, if we weren’t resilient, we could have just quit. But we kept on fighting, and it ended up really well for us.

For me, the hardest lesson I learned was getting my credit cards ripped up. I would charge something and think I would be able to pay it off and then not be able to. I can’t tell you how many credit cards I had ripped up.

But over time, what I’ve learned is using a credit card is okay if you pay it off at the end of the month. Just recognize that the 18% or 20% or 30% you’re paying in credit card debt is going to cost you a lot more than you could ever earn anywhere else.

NOTE: The long-term average return for U.S. stocks is 10% a year. For government bonds, it’s around 6%. For cash, it’s 3%. In effect, paying down credit card debt charging 20% annual interest will “earn” you more than double what you could ever expect from investing. That’s why you should strive to pay down high-rate cards first, before building your investment portfolio. One exception: if you’re eligible for a 401(k) where the company offers you a match.

Paying off your credit cards after 30 days or not even using credit cards is the smartest investment you can make or not make.

Sara Blakely: Literally, I’ve always just spent what I could afford. I’m lucky that [the] kind of prototyping and product that I created—I didn’t have to go out and raise a bunch of money. I’ve never really had debt—if I can’t afford it, I don’t buy it. That’s just how I’ve been.

Cuban celebrates with Dallas fans in 2001 following a Mavericks home win over the Utah Jazz. Photo: Paul Buck—AFP/Getty Images 

Mark Cuban: You’re a lot smarter than I was.

Sara Blakely: I just didn’t have the appetite for it! The idea of owing people money caused me great stress. So I just didn’t.

Mark Cuban: In my businesses, once we got started, we had no debt. I learned very quickly that debt was not my friend. I agree with you there. But the key is living within your means. Saving money and putting some into a low-cost mutual fund—like an SPX fund—and living as inexpensively as you possibly can, will pay off dividends.

NOTE: “SPX fund” refers to any index fund that simply holds all the stocks in the SP 500 index, which represents roughly 80% of the broad U.S. equity market. In our MONEY 50 recommended list of funds and ETFs, there’s the Schwab SP 500 Index fund, which charges just 0.03% of assets annually (many stock funds charge around 1% a year).

While SP 500 funds are a good choice, MONEY actually recommends building the core part of your portfolio around so-called total stock market funds. These include SP 500 shares but also small- and midsize stocks. In the MONEY 50, there’s the Schwab Total Stock Market Index fund, with an expense ratio of 0.03%.

If you’re making $30,000 or $40,000 a year, it’s hard. But at the same time, if you can find a way to save, if you can find a way to invest inexpensively in the market, you can start to build your net worth. You can start to make good things happen. I think that’s possible for everybody. I’m not saying that it’s easy, particularly if you have a family. But if you can find that discipline, then you can save.

Sara Blakely: When you do spend money, think about what you’re spending it on and what the return is. For my particular journey, I spent money on motivational and inspirational tapes, and all of my friends made fun of me and laughed at me.

Mark Cuban: I did the same thing. I did the same thing.

Sara Blakely: Right! I was spending money investing in myself. Just like an athlete: You can have two athletes that have the same kind of physical strength, but why does one win? It’s mental. It’s always mental. Never underestimate the power of your brain, and that’s your greatest asset.

Mark Cuban: So true.

Sara Blakely: We spend a lot of money in our culture on entertainment, but we spend very little money on the inner work of our self. That’s an investment that ends up reaping benefits for the rest of your life.

Mark Cuban: I used to ride around all day looking at big houses, listening to Zig Ziglar on motivational tapes that I bought for half price at Half Price Books. Absolutely.

Sara Blakely: Brian Tracy, Wayne Dyer, Tony Robbins …

Mark Cuban and Sara Blakely filming season nine of Shark Tank in Los Angeles in June. Photo:Eric McCandles—ABC 

Mark Cuban: Yup. All of them. Honestly, when I first really made a lot of money, I bought a plane. That was my all-time goal because the asset I value the most is time, and that bought me time. Other than that, I’ve lived in the same house for 18 years and still have the same cars. Other than the plane, which is a big splurge, I’m still a slob. Not all that much has changed.

Sara Blakely: Yeah. My main thing is I just spend below my means. And as my means change, maybe what I can spend changes, but I always keep that as my baseline. If I’m spending well below my means, I’m going to be in good shape. I’ll spend money on things that save me time. I’ll spend money on things that create unique experiences for myself, my family, and the people I love. That’s where I like to spend my money.

But I don’t have a plane. #Goals.

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