The Financial Diet

The Financial Diet is a compendium of clever money tips for beginners, offering thrifty spending advice and sound money strategies in a wide range of areas, such as budgeting, investing, work, food, home, and even love.

I still remember the only day I ever was in debt. My girlfriend at the time was even more broke than I was and asked me to lend her some money. I did, and when my rent payment hit, I suddenly stared at a negative bank balance of about 200 €. I was terrified.

That day, I learned that I literally can’t sleep when I’m in debt. So, to prevent more cold sweats, I made a rule for myself: Never take on debt. I know, I know. “What about buying a house? What about credit cards?” To that, I can only say: No rule is perfect — but that doesn’t mean you shouldn’t set any rules.

Here are four principles Chelsea suggests. She calls them her “don’t you dares:”

Don’t you dare roll over your credit card debt month to month. If you can’t pay it back within a month, before the horrendous interest rates hit, don’t spend it at all. Don’t you dare live the CEO lifestyle. Bad spending is just bad spending, even if you’re busy running a company. You don’t need $300 haircuts and $100 cab rides any more after you start a business than you do now. Don’t you dare ignore your bank account. You should check your balance at least twice a week, Chelsea suggests. Don’t you dare wait for savings to magically appear. They won’t. Commit to a hard savings rate, then automate those payments.

Life is full of compromises one way or another. You might as well make some in advance and at least fully reap their benefits. Plus, you can always change your money rules once they really hinder you from moving forward.

From age 14 to 18, Chelsea painstakingly saved up $10,000 from working all throughout high school and saving 75% of each paycheck. Once she got full control over that money, she immediately blew it on fancy clothes, food, and parties. When she later re-evaluated her relationships with those things, in the food section, she took a page out of her partner’s Italian grandmother’s book: Instead of obsessing over individual recipes and paying a lot of extra money for “assembly” and delivery, learn to cook with whatever you have. This way, you’ll spend less, fret less about grocery shopping, and enjoy food a lot more. Here are some Italian grandmother secrets: If you have some oil, spices, garlic, and onions in your house, you can whip up a quick meal with almost anything, even…