Fiscal Responsibility
 

This has been on my mind for quite some time and only write this with the most heartfelt intentions.

I have noticed something that is a little disturbing to me but really none of my business but as a friend to many, I thought it best to express my views. (especially with newer/younger BOTLs)

The problem?

I've noticed many BOTLs who are over extended on their credit in the name of acquiring more cigars. I've heard some disturbing balances being maintained on their credit cards due to large number of purchases of cigars.

I believe that with the amount of discussions in the forums, pictures of collections being shown, crazy sales by retailers, that it is easy to get caught up in the "keeping with the Jones'" mentality but I would be remiss if I didn't express my concern.

PLEASE keep in mind that cigars are a hobby and should be BUDGETED for and is SOLELY based on disposable income. You SHOULD NOT be "investing" in cigars - they are a consumable that are susceptible to damage (fire, water, improper storage, beetles, theft, etc...).

People talk about a "cigar budget" and we all laugh when we blow that budget. But like any other aspect of your life, you REALLY should have a "cigar budget" and stick that budget the same as you would for emergency savings (6+ months), vacation savings, retirement, etc...

The senseless act of carrying credit card debt just to amass a cigar collect is not fiscally responsible and you are doing yourself a disservice in the long run.

The one thing that I have learned over the nearly 2 decades of being into cigars is that it's is not about the cigars. The cigars are just a compliment to the commaradarie. Yeah, the cigars are good but meeting new people and developing longer term friendships has been the best part of the hobby to me. There are many people that I now consider friends (some stay at my home) and I wouldn't have met them otherwise.

My point?

In the great scheme of the cigar community, cigar are meaningless and should not be coveted to the point where we throw away common sense and fiscal responsibility.

So please, take a step back and look at YOUR financial plan (if you don't have one, then make one!). It is your responsibility to take care of your financial security.

Happy smoking my friends.

~Mark


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Re: Fiscal Responsibility
 

Me thinks Mark was looking in the mirror when he typed this ;)

Seriously though,this is sage advice Mark.

Thanks for posting it :tu

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Words of Wisedom that should be heeded!!!!!!

This should be a Sticky!!!!!!!!!!

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Thanks Mark. I have been thinking along the same lines myself and while I don't have a cigar budget per se, I believe I have a reasonable approach that works for me. I'm self employed and have a set number of clients that I can count on for a solid base income every week. Usually once or twice a month I have small jobs come in that aren't on my weekly schedule. I take half of the income from the "non-scheduled" work and that's what the wife and I use for splurge spending - I use mine to buy cigars.

I have never been able to wrap my mind around the whole "invest in cigars" thing. In my mind, "invest" means you're going to see a profit from your expenditure. When I buy cigars I know I'm not going to re-sell them so there is no profit.

Now I do admit that I have a small stockpile for future enjoyment, but that's different.

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Absolutely! Cash is king, debt is death...

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Great post Mark. Hopefully some of the people in those situations will take your advice seriously. Bottom line, don't spend money you don't have.:2

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Great advise Mark!! Thanks. In 2 years of smoking cigars I have yet to charge any cigar, or cigar related purchase.

Unfortunately most who read this, will not reply because charging and paying the minimum monthly fee is the way of life in today's world.

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Yep - good post. Also reminded me that I had another responsibility in a group buy on another board that I was remiss in (apologies Mark - taken care of).

Personally though - cigars are one of those things that I don't use the credit card on - but I already have a budget in place (mostly - :ss)


Ron

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Don't be Slave to the Lender........Cash is King....

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100% agree... I haven't charged any cigar purchases. Ever. If I don't have the money in my checking account and enough to cover what else needs to be taken care of, I'm not buying... plain and simple.

Well written post, Mark :tu

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Nice post sir! :tu Now..... I can't wait for your Black Friday sale.. :D

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Great post MArk!

I learned along time ago from some wise older BOTL, if you cant afford what your smoking you won't trully enjoy the cigar.

The other lesson learned over the years is, and your 100% right MArk, its not about the cigar, its about the experiance. The experiance of bonding with great BOTL and relaxing. I've been extremely lucky to try some cigars, that I could never afford and I trully appreciate the guys that allowed me to take a puff here and there.

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Well said Mark. Cigars are a luxury and not a necessity. :)

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If anyone is interested in getting out of debt...I suggest Dave Ramsey's plan. I followed his suggestions and paid off about 17k of debt in 6 months. Debt is dumb, cash is king, and the paid off home mortgage has taken the place of the BMW, as the status symbol of choice!

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Live like no one else so later you can LIVE like no on else

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Is there a specific book or website or something you recommend for this?

Edited to add: Also, as a retailer, I think that Mark has a unique and useful insight into this.

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Try the links below. If you are motivated and follow his rules it will work!!

http://www.daveramsey.com/

http://www.amazon.com/Total-Money-Ma...7709042&sr=8-1

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How'd I know you'd be in here Tombstone? :tu :tu

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Agreed....a sticky this must become. This is a hard lesson I've had to learn and over the past few months, sat down, faced the harsh realization that at the rate I was spending, more money was going out than was coming in. I, too, felt the need to "keep up with the Joneses," and this is not necessary with the fine folks on this forum. Let me say that again: IT IS NOT NECESSARY TO OVEREXTEND YOURSELF FINANCIALLY TO KEEP UP WITH EVERYONE ELSE'S CIGAR COLLECTION!!! We will all "ooooh! and ahhhh!" over it, but take it from someone who knows...you will hurt in the end. There are some great people on this board who could honestly care less whether or not you have 2,000 premium cigars or 2 bargain sticks in your humidor....they just appreciate your friendship. If this place ever had any sort of "elitist" feel to it, I'd certainly not be here. During this time of Thanksgiving, i'm thankful for a place to meet with like-minded individuals for a few moments of each day. I hope all of you have a very safe and happy holiday with your families, and as always....smoke 'em IF you've got em! :ss

Jason

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Great minds think alike.:r

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Great advice Mark! I will be honest...when I first started in May I overextended myself with credit cards...not because I wanted to "Keep up with the Jones'" but because I usually jump in head first in most things I do. I have however been diligent in making cash be king. If I can't afford it on cash (not just cigars but in general) then I cannot afford to put myself in more debt.

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There is definately a lot of over spending going on. I am fortunate in that I am doing well currently and feel for guys loosing jobs, etc. However, over the last three weeks I have made several purchases on various forums from guys essentially needing cash, I did not need these sticks, I did it as I felt I was helping some folks out. Some of these were fair, some I got screwed but I never complained as I felt my $25-50 was helping a botl out. Truth is, my $25 is not going to help someone pay the rent. To a large degree I am beginning to think that the WTS sections on the various boards might contribute to the "cigars are an investment" mentality. I have sold cigars once on the forums because I did not have room for them, thats OK although I should not have bought in the first place right? Selling cigars you dont like, thats also OK. Selling swag, same argument, should we have bought it in the first place? (Hell, I admit, I am trying to sell swag now). But selling cigars to meet the rent is not good. I know this will sound like me being a royal a$$hole, but if you have debt on your credit cards you cannot pay off, struggle to make rent, you should not be smoking Padron 1926,Graycliffs, etc for the same reason I dont drive a Ferrari, yeah I could afford one by missing my morgage and getting action on the credit cards that would haunt me for a lifetime. The best cigars in my humidors come from folks selling them to make casht to pay the bills. Different strokes for different folks, and you do what you want with your money, but Mark is spot on and I am glad someone said it.

One final rant, I agree this should be a sticky. I have seen a lot of .edu email addresses lately. There are college kids in here with enough financial problems they dont realize they have yet without having to deal with a $300/month cigar habit!

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I'm curious. Where have you "seen" email addresses here at The Asylum? Are you talking about those that were provided to you by individuals? If so, that's o.k. But if you can "see" everyone's email address, that is a problem for the Team of 11 to address.

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Pretty sure its from when he is buying sticks from people. :confused:

(least thats what I got from the post)

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I agree with the OP, keep within your budget.

My only general disagreement is with people's idea that credit cards are bad, or that you shouldn't charge things. If you have the money, what's wrong with that? I pay my balances off each month and an amazing thing happens....I get money back from the CC companies for every dollar I spend, to the tune of several hunded dollars a year. I'm in the camp that guns don't kill people, people kill people. It's the same with credit cards, they're not bad, but irresponsible spending with them is of course.
They also are a great way to keep track of spending (debit cards will do the same though). We upload all transactions into a financial program to track spending and keep up with how and where we are spending money. Harder to do with cash transactions.

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With regards to posters asking were the .edu emails come from, it is from ****** accts, no security flaws for the mods to be concerned with.

Also, landhoney, I agree with you. I get all I can from my credit cards in cash back, consumer protection and even double warranties, but I pay them off like you which is why I said carrying debt. I treat my credit cards like charge cards and mostly enjoy up to 2 months (month+grace period) where big purchases go interest free. I think the message is that this is a restraint issue and that credit cards are the vehicle.

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I appreciate the prompt reply and am pleased that there is not a security flaw. :)

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One of the better posts I've read in a while.

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I've often thought about this subject when I read about how some posters are waiting to get paid in order to buy cigars. If you're waiting to get paid to buy something, then that means you probably have zero savings.

I built up a lot of debt in my 20s, buying expensive meals, booze and cigars. When I was making $12/hr, I was smoking Ashtons and Hemmingways every day. Now that I'm going to be 40 I look back and can see the error in my ways. I'm fine financially now, but it took me YEARS to dig myself out.

That being said, now may be the time to extend yourself and buy some boxes. If these new taxes take effect, who knows how much they may cost in the future.

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And here, I'd say the nail has been hit on the head. This attitude (unfortunately, in my own personal experience) is what can, if left unchecked, lead to destruction.

"Oh they'll never be this cheap again"

"I'll never see these again"

"That's a great price on those"

These are all thoughts that have cost me a considerable amount of money.

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I have to agree... this is Great advice from Mark to stay within your budget, but it is also a good idea to use the perks given to you if you can.

I keep a credit card on hand for monthly usage and I charged lots of stuff on that card. I get cash rewards for using it, plus I keep my money in the bank to earn interest (which is a crazy 4.56% on my checking account). Then come the due date on my card I pay off the entire balance that month... It is my special way of sticking it to the man since he stuck it to me until I learned not to carry balances... :D

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Well said, there is a reason my humidor is pretty light, I want to buy a house soon, as much as I like burning money *yes enjoy the pun* I know there will be a time in life I have to enjoy more things, but right now school and work are #1.

They will put me in a better place, I can swing grabbing a few sticks here and there and I do and I enjoy it. I get to smoke almost as much as I'd like, and I feel really happy I get to smoke what I do as "often" as I do.

The more active I'm here the more I see what you mean about the cigars go with the people i've never seen a site with such a cool group of honestly caring people. If I never had another stick again I'd still be here often.

I work with a lot of people in my age group *early 20s* and you are right, they are swimming in debt, for foolish things at that not even investments like school. One of the most glaring cases that sticks out in my head was someone dropping a good degree one year away for a sports car.

It's a great hobby and great group, don't let impressions take you down, I feel if you conduct yourself here well you'll be liked and treated just as well if you smoked one stick a month then if you had a weekly flight to havana lined up to stock up.

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Thanks Mark, you just saved me and lost you money... no really thanks. Good advice. This forum is like poison to me - every thread I see - I end up asking myself have I tried that? Everyone else seems to have experienced this or that - why not me!? And I spend more than I should - That explains why I'm broke! :cb My budget is zero - starting.... now...... :confused:

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One does not have to use credit cards in order to overspend...

This post was a great reminder to live within one's means (pot calling the kettle black here).. cigars are a luxury.

Something else one might consider when trying to enjoy the leaf while maintaing a budget is this..... if you didnt know the brand or cost of the cigar you were smoking you might be surprised.... You dont have to spen 5-10+ dollars to find a good smoke. Spend wisley... some great cigars out there that wont break the bank.

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I only spend what I don't need for anything else, and only spend what I've got. My responsibilities go first, and I only use debit.

But this is a good read, and should be stickied.

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Great post Mark! I for one have adopted a cigar budget for the New Year as well.

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This is one of the reasons I try to hold myself to only a couple of cigars a week (more or less).

I have on occasion built up a balance, but I intentionally chose a fairly low limit on my card when I got it, so that it couldn't get out of control. And I've never done it on cigars...though the one and only time my card got declined was at a B&M. (I still carry that rejection receipt in my wallet to this day.)

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I don't know that this could be true in all circumstances. I may wait until I get paid to buy certain cigars because cigar money does not come out of house money - it comes out of whats left over - play money if you will. Currently I spend $150 every two weeks, budgeted, on my staple cigars. So any cigar money outside of that is from what ever is leftover after bills, savings, etc are paid. That money though could be spent on books, tools, computer parts, truck parts, etc etc - just about anything that I don't really need - :ss


Ron

Re: Fiscal Responsibility
 

Nice!
I especially like what DGAR had to say.
There are so many good cheap sticks out there.
I grew up dirt poor so pinching pennies comes naturally.

Re: Fiscal Responsibility
 

Nice post by Mark the OP.

Hobbies are supposed to enhance our lives with fun and inveraction. Most aspects of ours does. The downside of the "slide" is that it can addict those so inclined to an ever increasing load of purchases. Good news is that you can always resell them without significant material loss if you buy right.

One contrarian point that has only to do with timing. If as part of "your plan" regarding prudent cigar purchasing you anticipate and budget a larger than normal portion of your budget in the "now to christmas" period, much $$ can be saved by significant sales.

Or you could be homeless my January. :D

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Very true...but only if you are managing your collection to a finite space. If you simply add storage as your collection increases, then "sales" purchases become incremental -- rather than opportunities for "savings."

I committed to a space (albeit a big one) and that is how I keep spending under control. It is impossible for me to store additional cigars beyond my agreed upon storage space without compromising their condition. I also only buy cigars with debit -- never on credit.

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Your willpower is an example to all! :tu

Me? I'm gonna buy another cooler on Friday. :fl:D

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I vowed never to go back to coolers. They drive me bonkers.

Willpower? Well, I don't think they make a bigger Aristocrat...lol.

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I agree, I don't ever dip into my savings for my hobbies, I just use whats left over from payday. That is unless I set up an additional savings pot with the extra money specifically for that hobby.

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Maybe coolers like short trips? :)

I did the same vow when I bought the cigar Club Wall thing. Vows work only until you are confronted with "that last thing" that wont cram into available space. For me it was Monte A's for sub $6 a stick. Vows be darned and coolers be bought.

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Yes...at a moment like that, everything goes out the window!!! :tu

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Crap...I'm about ten boxes away from being tested by the Universe...lol

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Not as infinite as the universe, but I'm pretty sure the cooler manufacturers have us covered in our times of need. :D

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Great post and oh so true. This philosophy should be used on all aspects of life and if everyone used this mentality the country and economy would be in a lot better shape right now. I have put myself in the credit card hole many times in the past and now we try to use cash for most things to avoid that mistake again. I have been working my ass off to get rid of a lot of dumb bills with side work and it has worked and I feel so much better knowing I can pay cash for things now and can put money into savings again. As far as my Cigar budget, it is almost Nil these days just with the economy being the way it is and the fact that there have been major layoffs at work and you never know if your up next. Went a little crazy this month with a handful of purchases but I did it as sort of a reward for myself for working so hard the last year but overall I have cut my purchases down a lot but than again I could probably honestly go a year without making a single purchase and still have plenty to smoke. Yet another reason why I have slowed myself down.
Just don't do this with cigar purchases. Use it in every purchase of your life. Hell, I hate seeing the people in my neighborhood who over bought and than can't afford to do basic landscaping or improvements to their homes because they are house poor. Again, if everyone learns to budget a little better and not over extend themselves than the country as a whole will improve financially. Unfortunately, most of us learn this the hard way. I know I did.

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Just want to add my AMEN. And I was pleasantly surprised to see this thread take a brief detour to endorse Dave "Better Than I Deserve" Ramsey's teachings. I couldn't agree more with the OP and with Dave.

I could buy more cigars and more expensive cigars than I do, but I try to stick to a budget! What a concept! I've got some nice cigars in my modest humi, and I'm content with them ( well, most of the time). I'm proud to day I'm debt-free except for my mortgage, pay my credit card off every month, and do it all on a modest salary. If you want to have a sense of freedom, try living on less than you earn! As Dave says, part of being an adult is having the ability to delay pleasure in order to achieve a greater goal! It's absolutely worth it.