Hey, guys.

It's Chelsea from The Financial Diet. And I'm jumping in with something extremely exciting and totally new for TFD.

We are launching on September 12 on YouTube and on all streaming platforms where you love to listen to your podcasts a brand new show called Too Good To Be True. It's sort of where personal finance meets true crime, and it's all about exposing the various scams and MLMs and cults and predatory financial services, and otherwise dubious money phenomena that you've probably encountered in your own journey toward getting good with money. And yes, we talk about crypto.

It's hosted by editor, podcaster, and journalist Ryan Houlihan, who you've seen a few times on this channel, and financial expert Julia Lorenz-Olson, who in addition to being an absolute money maven is someone who swims in a lot of the circles that we're going to be talking about as a former evangelical mom living in Texas. Our first episode will be a two-parter, one part exposing the long relationship between the evangelical church and finance in America, and the second part being a deep dive on Dave Ramsey himself, including some interviews with people formerly associated with his empire. Too Good To Be True, premiering September 12, is all about what happens when money goes bad and how to protect yourself.

Tune in here and we'll see you then. And today, we're doing another of one of our beloved Buy This Not That. And we got a lot to get to, so let's get cracking.

Number one is get a Flexible Spending Account for medical expenses instead of paying from a regular savings account. So while having an emergency fund for any of the day-to-day emergencies that might occur in your finances-- things like job loss, having to move unexpectedly, et cetera-- you could be missing out on some distinct tax benefits by not putting your specific medical emergency fund into special accounts designated for that purpose, often called flexible spending accounts, if they're available to you. Flexible spending accounts allow users to cover the cost of certain medical expenses from pretax dollars to help offset medical costs.

You can only use the money on approved items which are laid out on the IRS Publication 502. Generally speaking, if your doctor prescribes a test, medication, or medical equipment, you can probably pay for it from FSA funds. You can also pay for dental appointments, chiropractors, eyeglasses, contacts, hearing aids, addiction treatments, modifications to your car or home if you or a loved one have a disability, ambulance services, and books and magazines printed in Braille.

You can even pay for some transportation costs related to health treatments and the training and care of a guide dog. So these are offered as part of employer benefits when they're offered, so unfortunately aren't available to people who are, for example, self-employed or who don't have their health care benefits through an employer. But if you do have one available to you, you can choose how much you want to contribute to it, which will then be deducted from your paycheck and will then reduce the overall amount of income you're being taxed on.

The contribution limit for 2022 is $2,850. And we would recommend calculating your expected medical costs for the year to determine how much you want to contribute to your flexible spending account from each paycheck. But remember that this is a use-it-or-lose-it type of account, and you have to use the money for covered medical expenses only.

As of 2022, you can roll over $570 from your FSA to the next year, so plan what you're saving wisely. And think of this if you have it as a good motivator to be spending on the health care things you actually should be spending on. Number two is renting a wedding dress instead of buying one.

So we've talked on the channel before about the wedding industrial complex and all of the frankly chaotic and many times unjustifiable spending decisions that it leads people, especially often women, to make during that time. This subject has frankly gotten me in a bit of trouble in the past, and I will link you guys to the video in question as well as the follow-up conversation that I had with a wedding planner/YouTuber who called my [BLEEP] out about it. And we can disagree on some of the particulars, but what is pretty universally true is that not only are weddings a time where there can be quite a bit of markup for the same products and services, it's also a time where through a combination of social media pressures and gender pressures and family pressures and the perception that this is the most important day of your life-- which, citation needed-- we're often finding ourselves making all kinds of spending choices we otherwise wouldn't make.

And one of the most potentially egregious areas of spending in this regard is on the super expensive, super custom, big, beautiful wedding dress, which many women who otherwise would never invest like that in a piece of clothing, let alone one they only wear once in their lives, are suddenly finding themselves purchasing. And many of them go into it with this perception that they're going to spend all this money on a wedding dress, but they're going to find ways to reuse it or get it altered to be more casual or dye it and then pair it with a cute jacket, I guess. But nine times out of 10 in my experience, these dresses just end up in a sealed bag in the back of your closet for decades until eventually you're like, here, daughter.

This is the dress you can wear for your wedding. And she's like, mm, pass. [LAUGHS] I'm someone who personally spent, between the dress itself and the alterations, about $150 total on my wedding dress, which also wasn't white, for what it's worth. All of our guests were white and my husband and I wore dark blue.

It was very culty. I liked it. But I definitely was someone going into my wedding that was like, white isn't my color to begin with, and I know I'm not wearing my wedding dress again.

So minimize spending on that so we can spend more on things like really good food or accommodations for our guests for the week. But if you are someone who maybe does look great in white and has always dreamed of the big, nice wedding dress, it is very crucial financially that you check out the option of renting one. "According to Brides and The Knot, the average cost of a wedding dress is about $1,600. And if you can't afford that or simply don't feel like forking over so much for one-time formal wear, there is a cheaper option: renting your wedding dress.

With renting, you'll pay a fraction of the purchase price and keep the wedding dress for a fixed amount of time before sending it back. This option can drastically reduce the amount that you shell out." And "you might be able to choose from designer dresses that would otherwise be too expensive to buy." Now there are some drawbacks in the sense that there's often a lower range of choices. The alterations you can make may be more limited or may not be allowed to be permanent alterations.

But at the end of the day, having been to quite a few weddings and having had actually technically more than one because we had a civil wedding and then a ceremonial wedding, literally the last thing you're going to remember is the extent of the alterations on your dress. You're going to remember things like seeing your loved ones, the really good food, dancing with your spouse, and maybe even things like, I don't know, cute candles. But given that we now live in an era of renting being available for all types of expensive formal wear-- that means including for things like other weddings or formal events you might be invited to-- there really just is no reason anymore to justify shelling out, again, on average well over $1,000 for a dress you're going to wear once.

Number three is free hand-me-downs/secondhand baby clothes instead of new baby clothes. So this is something that all of the moms at TFD swear by because babies grow out of clothes at an insanely fast rate. And also, babies are disgusting and get their clothes disgusting.

So while you may be tempted to get a special little outfit for your baby here and there or receive them as gifts from loved ones because grandma just absolutely wants to see her newborn grandchild dressed up like a sunflower or a bee, remember that this is probably one of the last areas that you should be spending any money you don't have to. "In 2017, NerdWallet reported that parents spend anywhere from $21,248 to $51,985 in their child's first year of life. NerdWallet lumped clothes in with other miscellaneous items like clothes, diapers, toys, a stroller, et cetera, and reported that people spent between $1,941.33 and $6,667.38." Now obviously a lot of the expenses associated with having a newborn baby are just not going to be possible to not spend on. You have to feed the baby, for example.

But in case you haven't noticed, baby's clothes literally come in sections of a couple months at a time because that's how quickly they can no longer fit into the onesie they were wearing a couple months ago. So doing everything you can to minimize if not eliminate the extent to which you're spending on very ephemeral baby clothes is hugely key to reducing costs in that first year or two of life. So aside from obviously your own previous child's clothes if you have them, friends and family, neighbors who might have some clothes that they could hand down to you, there are tons of Facebook groups out there just specifically dedicated to this purpose.

I guarantee there's probably several around you if you haven't checked them out already. Again, baby can have one or two cute little tutus, but outside of that, we've got to go cheap. Number four is having a car-specific emergency fund instead of getting an extended warranty.

So first of all, what is an extended warranty? So it's exactly what it sounds like, which is a warranty that goes beyond your original warranty items to cover things like replacement parts for your car. However, an extended warranty likely costs a lot more than what you'll actually end up using it for. "Just like the amount of time and miles that will be covered, the cost of an extended warranty varies wildly, anywhere from $1,000 to several thousand dollars upfront, plus per-visit or per-repair deductibles that can vary from $100 to hundreds of dollars." And it could potentially save you on repair costs, but a Consumer Reports survey found that the majority of people who took out extended warranties paid more than they received in benefits.

And there are a lot of other cons too like "overlap if the coverage period of the extended warranty overlaps with the manufacturer's warranty, you may pay for a warranty you're already getting at no cost," or coverage like extended warranties, which "typically don't cover everything that might go wrong with your car." Service requirements, like "you may be only allowed to have your car fixed at certain locations," depreciation clauses where "some extended warranties only pay for a portion of the cost to repair or replace parts that need to be fixed, based on the car's mileage," or reliability, because "under most extended warranties, either the dealer, manufacturer, or an independent third party is responsible for paying for the repairs. If the entity that's supposed to pay the bill goes out of business, for example, you may be stuck with a warranty you literally can't use." So if you are someone who has to be very conscientious about always having a very functional, reliable car and never being caught unprepared for the costs associated with it, you may want to consider putting that money instead into a car-specific emergency/sinking fund which you never touch for any other purpose. On average, it's likely to be a better way of ensuring that you're not overpaying for something you don't end up fully using.

Number five is microblading versus constant eyebrow treatments and cosmetics. So I should say upfront that this point literally only applies to you if you are a girly like me who does her eyebrows every single morning and a couple times a year goes in for actual eyebrow treatments like threading, shaping, tinting, et cetera. Because if you're not an eyebrow person, then you can just disregard this point.

But if you are, it's pretty established cosmetically that eyebrows that are well shaped to frame your face can make a pretty huge impact on your overall appearance. And if you're a redhead like me who has really light eyebrows-- now we're not talking about whatever look this is that Julia Fox has going on right now, light eyebrows, but definitely they tend to fade away, especially in the sun-- you may, like I do, start literally every single day with a little brow routine on top of the other treatments. And just as a quick breakdown using my own example as someone who's about to get microblading after running all the numbers on what this costs me over the years, I buy an eyebrow tool around once every one to two months, typically opting for the Benefit Precisely pencil, which runs about $24 at Sephora.

Plus around one to two times a year, I'll get my brows professionally done, threading and tinting, especially when I'm going places like travel where I'm going to get my face wet a lot, which will typically run me about $80 including tip here in New York City. So in total, I'm spending somewhere around $300 to $400 per year just on my freaking eyebrows, which is kind of insane when you think about it. But listen, I mean, we just heard what a kid costs, and I'm not having those.

So we all have our financial choices to make. But the average cost for microblading, which is a procedure with very fine, hair-like tattoos which are used to replace the look, tint, and shape of the eyebrows you're creating each day through cosmetics, runs about $550 here in New York City, which, while a larger upfront cost means savings in the longer term due to no longer having to use the day-to-day products or professional treatments. It should be stated that microblading needs to be touched up about every 18 to 30 months, which does have the benefit of meaning you're not committed to one eyebrow look literally forever.

But there are also ways to extend the life of your microblading through things like proper aftercare. And again, it's pretty easy to do the math whether or not this would be the long-term right solution for you. Anecdotally, the other brow girlies in my life who've gotten microblading have all been like, it's a life changer.

I'll never go back. Blah, blah, blah, blah, blah. So I'll report back on this channel what I think about it.

But at the end of the day from a purely financial perspective, despite being a larger upfront investment, the numbers work out in my favor. Number six is term versus whole life insurance. Now in our upcoming podcast here at TFD called Too Good To Be True, we have an entire episode on just faux/scammy financial services with whole life insurance being one of them.

I'm not going to dive super deep into the concept here, but just to give you a quick idea, essentially on the surface the difference between term and whole life insurance is very simple. Term life insurance is a policy with an expiration date, and whole life insurance doesn't expire as long as you pay the premiums. With term life, you pay a flat monthly premium for a set length of time, usually 10 to 30 years.

And it's more affordable the younger and healthier you are when you take out the policy. Whole life insurance has a much higher premium where part of it goes to the insurance and part of it goes to the, quote, "cash value," which pays a reported dividend of 4% to 6% per year. And the cash value is supposed to offset the cost of insurance as you get older.

And it's important to note that as the name would suggest, whole life insurance doesn't expire. But when you think about it conceptually, the entire point of life insurance is that it is supposed to be supplementing income and providing financial relief if you are to die in a time where you're theoretically in your highest earning years. It's, again, an insurance policy against what the alternative is, which is actual financial planning and earning money.

And yes, theoretically you could get out of your whole life insurance more than you paid for it depending on how long you had it and how much you paid into it, et cetera. But remember that the interest is only applying to that cash value portion, not the entire amount. Also, it's important to note that agents sell whole life insurance based on the promise of tax-deferred growth.

However, you can see that same type of growth or more really with an account like an IRA or a 401(k), so you don't actually need whole life insurance in order to take advantage of returns. And they only guarantee a 1.5% rate of return, which is awful from an investment perspective. It is almost guaranteed that you are better off financially by getting a term life insurance policy with a lower premium and an expiration date, and then investing the rest of the money that you would be putting toward that whole life insurance.

Reusable glass and plastic containers versus eco-friendly food storage, water bottles, et cetera. So as we've discussed in previous videos around things like greenwashing and sort of faux eco-friendly purchases, ultimately no matter how sustainably or well produced a specific item is, it's pretty much always going to be more wasteful than just using something you already have. But especially for people who are looking to make more and more ethical and environmentally friendly purchases, the siren song of getting everyday items which were produced in a healthy and sustainable way can override the reality that ultimately you're just buying more stuff.

As one TFD article put it, "Zero waste is also sometimes presented as zero plastic, and not all plastic is single-use or has to be single-use. Even though lots of people online will tell you that plastic Tupperware is unhealthy, filled with chemicals, still devastating to the environment no matter how long you keep it for," et cetera, "I wouldn't take that as a recommendation to run out and buy a ton of expensive glass or aluminum containers, the latter of which are obviously not microwave-safe." Especially, for example, when the widely perceived danger of BPA, which stands for Bisphenol A, a chemical used to produce and harden some plastics, is actually fairly in dispute by experts as far as how much of a danger that it actually represents to humans. But keep in mind that many of the day-to-day items you're likely buying at places like the grocery store are not even necessarily going to be in plastic containers, let alone plastic containers that themselves contain chemicals like BPA.

Many are going to be glass, et cetera. But it's worth remembering that even if a product itself meets all of the standards we have in mind, it doesn't necessarily guarantee that, for example, the production methods, the labor that goes into it, the shipping, and all of the various behind-the-scenes stuff that allows ultimately what are new consumer items to arrive at your home are ever going to outweigh the benefits of just simply reusing things you already have. And lastly, keep in mind that with a lot of these hyper eco-friendly containers, bottles, et cetera, many of their claims ultimately boil down to greenwashing and just savvy marketing anyway.

And that even if you think you are buying the best version of that item, chances are you may be getting misled by their copywriting. We'll link you in the description to a great website on assessing the actual eco-friendliness of any particular brand and product, but this should just serve as a reminder that you're better off reusing than buying new basically no matter what when it comes to being eco-friendly. Lastly is to go grocery shopping on Wednesdays versus any other day of the week.

So this isn't so much a specific item as a behavior shift, similar to the savings accounts. But in order to get the best bang for your buck when it comes to grocery shopping, try doing it on Wednesdays to see the difference it makes. According to Instacart, "The bulk of grocery stores begin their weekly specials on Wednesdays.

This makes Wednesdays the best time to shop if you want to get the most bang for your buck. Since the specials have just changed, some stores will also still honor the previous week's coupons and deals. In this case, you might be able to enjoy a double discount." It's also important to do the shopping later in the day as many stores will mark down items that were made that morning in store, things like baked goods, premade foods, et cetera.

In general, each store is going to have a slightly different schedule when it comes to this stuff, so it is worth asking your regular grocery store when their sales cycles and whatnot happen. But timing your grocery shopping to the best deals and offers is an easy way to ensure that the regular items you're buying regardless you're able to get at a better, more competitive price. And besides, studies have shown that the less frequently you're going grocery shopping-- doing it regularly at a predictable time with a coherent list-- you're going to be spending less overall because you're not going to be just constantly popping into the grocery store where you're going to be tempted to buy a whole bunch of other stuff you don't need, and are likely over buying with things you already have at home.

We'll do another Buy This Not That later in the year. But in general, do keep in mind that when it comes to any purchases you're regularly making or things that you've just always learned to assume are a good deal, it's probably worth checking out if you could be getting a better version elsewhere. As always, guys, thank you for watching.

And don't forget to hit the Subscribe button and to come back every Monday, Tuesday, and Thursday for new and awesome videos. Goodbye.