Cut Your Self-Imposed Taxes
Whether a tightwad or a spendthrift, everybody faces the same reality: we all have to pay tax. And nobody enjoys paying tax. Some complain loudly. Others try to dodge it. Most grumble but are reconciled to this fact of life.
Ever the optimist, I try to think about the good things my tax money is paying for in society and pretend none of mine is spent on another failed government computer project. All up, paying tax doesn’t exactly give you a warm glow.
However, taxes aren’t only imposed from outside. Through our actions and attitudes, many of us impose unnecessary additional taxes on ourselves. Let’s look at what these are, what causes them and how you can greatly reduce your self-imposed tax burden.
This idea is inspired by the following passage from Benjamin Franklin’s Way to Wealth. It suggests there are three types of personal tax: idleness, pride and my personal favourite, folly:
Friends, says he, and neighbors, the taxes are indeed very heavy, and if those laid on by the government were the only ones we had to pay, we might more easily discharge them; but we have many others, and much more grievous to some of us. We are taxed twice as much by our idleness, three times as much by our pride, and four times as much by our folly, and from these taxes the commissioners cannot ease or deliver us by allowing an abatement.
Part of the problem is that we can easily complain about externally imposed taxes, but those we impose on ourselves are more easily rationalised. But as Franklin suggests, they may cost you more than your actual tax bill.
What I’ve got here is a new way of looking at tax in the context of all your other expenditure. The key is seeing all your wasted expenditure as a self-imposed tax. So while you might not be able to cut your government tax bill, you can cut your overall tax bill by making smarter spending decisions. You get to stick it to the man, except the man in question is the part of you that demands wasted spending through idleness, pride and folly.
Let’s look at a few examples of ways these three factors cost you money:
- Idleness: not being organised in booking trips early, meaning you pay more by booking last minute
- Pride: being too proud to drive an older car, wear last season’s clothes or even shop at a discount supermarket
- Folly: buying the latest and loudest gadget as soon as it’s released or spending more each month on clothes than you do on food
Now some of those are pretty extreme examples (especially when you eat as much as I do) but you get the point. And the ways to put these right are just standard money saving and frugality advice of the kind you can find on many frugal living, personal finance and lifehack blogs.
But it’s the new way of framing the issue that might give you an ‘Aha!’ moment. Recognising that your own personal ‘government’ is taxing you hundreds or thousands just by releasing new gadgets might cause your natural aversion to taxes to kick in and stop you making the purchase.
Even better, now your personal government is giving you a tax break on gadget purchases equal to the sum you would otherwise have spent. Kerching!
Don’t Go on a Crash News Diet
photo credit: Guacamole Goalie
I’ve read on several of the blogs I read that in the interests of productivity and wellbeing you should go on a ‘news fast’ to cut down on stress, information overload and reclaim some time.
Apparently all the killings and violence will make you sad, angry and stressed out.
But going on a crash diet isn’t a sustainable way of losing weight, so why should it work in the field of information? I’m looking for something a little more sophisticated than that.
Besides, cutting it out completely means you’ll lose a lot that you might actively want to see. Personally I’m interested in politics so I wouldn’t want to miss out on the latest developments in that area.
Nonetheless I can see the time benefit in not watching 30 minutes of non-personalised news each night. What you want is something targeted to your needs and preferences.
So here are my five suggestions for going on an intelligent news diet. Not the crash diet recommended elsewhere, but one you can stick to with a low Glycaemic Index yet high in vitamins and minerals:
- Cut out TV news: it’s not tailored to you, and these days you can do better and get more perspectives on the news websites. My preferred method is to listen the BBC’s Newspod on my way to work in the morning. Many other newspapers offer similar services.
- Get RSS updates on the topics you’re interested in: science & technology, sport, politics, the opinion page.
- Check favoured news sites once a day or get a daily digest of the news: in the UK the Guardian newspaper offers a free pdf bulletin on a number of topics at the end of the day, perfect for reading on the way home from work. This is an uncommon offering, but it’s balanced coverage and covers international news. Being customisable, you can make it relevant to your country or particular area of interest.
- Don’t miss the big stories: trust me, if something major happens you’ll know, you can’t escape it. You’ll likely hear about the bigger issues from your friends and colleagues. If you do hear about something this way, you can then choose whether to check it out.
- Ditch newspapers in favour of a weekly news magazine: good examples include The Economist or a news digest like The Week. And don’t feel you have to read it all. If you’re resistant to doing this because you’ll miss your favourite regular column, see if it’s republished on the newspaper’s website. Most make all their content available free online or via RSS (see above).
Now depending on your appetite for news even this pH balanced diet might seem too restrictive for you. But give it a shot and see if it frees up some brain space. You might just find you’re having ideas that’ll see you make the news.
