Like so many people, I learned a lot of investing lessons the hard way in 2008. Lesson number one: the vast majority of mutual funds don’t outperform the market. I’ve heard this a hundred times before, but it really didn’t sink in until I watched all of my funds lose over half of their value in 2008. Now I feel torn about what to do with any new money I save in 2009. On the one hand, I know I’m supposed to put more money into the market when it’s down. However, I feel like a fool for paying high fees to mutual fund managers who aren’t even adept enough to match the returns of the market.

John C. Bogle recognized this problem years ago when he began his career on Wall Street, which is why he founded The Vanguard Group. Today, Vanguard is known for the low fees it charges for the management of its mutual funds. Vanguard’s index funds match the performance of broad indexes like the S&P 500 at minimal cost to the investor.

If you believe the stock market will recover eventually and continue to offer returns consistent with its past performance, index funds are a great investment now. The only downside is that index funds aren’t very sexy. If you’re more of a do-it-yourselfer, you might want to buy a few individual stocks on your own. This can be a smart move if you stick to companies that feel you know well and you don’t invest any money you’ll need in the next few years. In addition, you should be willing to do a few hours of research, review the company’s recent financial statements, and compare its performance to its competitors’.

If that doesn’t sound too scary, you might want to open a trading account with a discount broker like Scottrade. At $7 per trade, they’re one of the cheapest online brokers and I’ve had a great experience using them in the past. If $7 still sounds pricey, you can try zecco.com, which offers 10 free trades per month for all their clients. Their site has advertisements and isn’t quite as user friendly as others I’ve tried, but the commission savings can really add up if you wind up making more than one or two trades a year.

For those of you looking for more reliable short-term options, I’ll post a follow up soon on banks offering savings accounts with the highest available rates of return.

A friend of mine went to Banana Republic a few weeks back and told the cashier he couldn’t buy all the items he brought to the register unless they could give him some kind of discount. The cashier gave him 30% off everything on the spot without batting an eye. Initially, I was moderately impressed, but I assumed there must have been some sale going on that my friend didn’t know about. I thought the whole thing seemed suspect, especially since my friend told the cashier he forgot to bring a coupon with him and the coupon was only good for 25% off.

Apparently, my friend had stumbled on to a new trend at major retailers: haggling on everything from pricing to return policies. According to an article I read today on MSN’s Money, J. Crew managers are taking back items long after return deadlines have passed and Best Buy employees are matching prices that shoppers find while comparison shopping from their cell phones. Check out “Shoppers haggle for deals from desperate retailers” for more info.

I’m not an avid reader of Men’s Health magazine. It probably goes without saying that I don’t get much out of articles like “How to Tell if She’s Faking It” and “Sexy Statements That Turn Her On”. However, I love their “Eat This, Not That” feature. If you’re not already familiar with it, “Eat This, Not That,” is probably best known for identifying the most unhealthy foods at popular restaurants and promoting items on the menu that provide healthier alternatives. The “Eat This, Not That” website is full of handy resources, including a guide to the “125 Healthiest Supermarket Foods” and revealing exposés like this warning about the worst drink on the planet and “The 20 Worst Foods in America.”

I like that “Eat This, Not That” takes a realistic approach to cutting fat, calories, sodium, and sugar. The goal isn’t to mangle every meal at McDonald’s or Outback Steakhouse until it fits into a Weight-Watchers-approved point count. The authors just want to make it easier for all of us to eat a bit healthier by making small changes that don’t feel like big sacrifices.

I’m a big junk-food junkie and two of my big loves are Little Debbie Fudge Brownies and Swiss Cake Rolls, but they’re both insanely high in saturated fat. So, a few months ago, I started doing a little snack cake research of my own in the spirit of “Eat This, Not That.” I wanted to find a brownie substitute that wasn’t a rice cake or some other bland diet food that I’d buy and never eat. (I already have an entire shelf of health foods that have survived three moves because I never get desperate enough to eat them, but I’m too cheap to throw them away.) I started with Twinkies, since they’re low in fat by Hostess standards, but they didn’t satisfy my chocolate craving. So, I recently switched to Zingers, which have less than half the fat of Fudge Brownies and Swiss Rolls.

I realize part of this is just a portion control issue, since there’s only one Zinger/Twinkie per pouch, as opposed to Swiss Cake Rolls, which are packaged in twos. I suppose I could limit myself to one Swiss Cake Roll at a time and wrap up the second, orphaned roll for later. However, this would still be worse than eating a single Zinger, which has five grams of fat as opposed to the six in one Swiss Cake Roll.

While I’m happy with Zingers, the Swiss Cake Roll math situation has worn me out. So, I’m pressing onward in search of a sweet, tasty snack that is healthier than anything in the snack-cake category. For now, I’ve settled on Rice Krispy Treats, which have just 2.5 grams of fat and 90 calories. And when a chocolate craving hits, I can have a chocolate and peanut butter version that has just 1 more gram of fat than a plain Rice Krispy Treat. I’m also giving Kudos bars a try, which are a good compromise between a healthier granola bar and something really bad, like a Kit-Kat or a Snickers.

If you buy $100 worth of gift cards between now and December 31st at any of the OSI Restaurants (which include Outback, Carrabba’s, and Bonefish), you’ll get a $20 bonus gift card free. There are some restrictions on when you can use the bonus card, but if you eat out any of these places a lot (or know someone on your Christmas list who does), it’s an easy way to save 20%.

One thing I hate about Christmas is the last minute rush to get gifts for people on my list who are hard to buy for. I usually break down and buy something generic and inoffensive, like a shower gel sampler from Bath and Body Works or a pair of slippers. This year I’m actually considering buying one set of grandparents a cookie basket because there’s a Mrs. Field’s near my office and I have absolutely no idea what else to get them.

It’s especially hard to buy for parents and grandparents because in many cases, they just don’t need more stuff. And typically neither do we, so the holidays quickly turn into a sort of gift-giving cold war that begins around the time we graduate from college and get our first real jobs. Both sides really just want to call the whole thing off, but they’re both afraid they’ll be caught unprepared. So, we keep stockpiling gifts, hoping the other side will cave first. We keep finding ourselves in the Sharper Image store on December 20th, scanning the shelves for anything under $25 that could intercept and neutralize the tie organizer or GAP gift card we know the other side is preparing for launch. And just when we’re ready to give up, we spot a mini clamp-on book light or mini neck massager or mini ionic breeze on sale.

This year, I’m racking my brain for gift ideas that aren’t featured in the SkyMall catalog. I like gifts that will help me bond with the recipient and/or provide a special experience or activity. Here’s what I’ve come up with so far:

• A mix CD. This is an oldie but a goodie. 5inch.com is a great place to get super cool CD-Rs and they also happen to be Chicago-based. This year, I’m sending my grandma a sampler of some of my favorite classic Christmas songs and another CD of songs from my music collection that I think she might like.
• Cooking class: For Chicagoans, I’ve heard classes at The Chopping Block are a fun and relatively affordable option.)
• Theater tickets: The special offers page for Broadway in Chicago can be a good place to start. Last time I checked they were offering $44 main floor seats for all Tuesday and Wednesday evening performances of Dirty Dancing, which is a really good show to take a parent or grandparent to see.
• Pampering: Go with your mom to get a pedicure, take her to your favorite salon for a hip new ‘do, or try a bargain-priced facial from a student at your local Aveda Institute. If you’re feeling more generous, you could get her a massage from the Cortiva Institute.
• Travel: This could be a simple day trip to go antiquing or weekend getaway at a nearby resort. You could also gift wrap a cup full of nickels and set a date to go gambling at the nearest casino. (I find the best thing about this gift is you can offset the cost if you eat eight to ten lobster tails at the $20 dinner buffet. Put a few filet mignons in your purse for later and you can easily come out ahead!)

  You might also want to treat someone to a more elaborate adventure, which is fine as long as you’re not going into debt to do it. Travel is one of the few luxuries that rarely gives me buyer’s remorse. I recently found out about a company called Shop Around Tours that offers tours of Italian outlets and factories where companies like Prada, Versace, Gucci, and Fendi sell items at deep discounts. Ten-day trip packages go for around $3,000, which includes airfare, hotel accommodations, and many meals. I also just heard about an annual gay rodeo in Calgary that sounds like a lot of fun.

I know these tips might be coming a bit late for many of you, but I hope they might come in handy the next time you’re feeling trapped as you stare at a display of bath salts or moisturizing gloves or soothing sound makers. Of course, if someone on your list is like me and actually asked for a soothing sound maker for Christmas, then by all means, dig out the 20%-off Bed Bath & Beyond coupons and go crazy.

A friend just sent me a link to an interesting article about large corporations that have recently revamped their looks—from basic logo facelifts to costly real-estate renovations. The new Pepsi logo (number 29 on the list) seems particularly heinous. Is it just me or does it look like it belongs on the tail of a Korean Air jet? The overhaul of Clue is also a bit unsettling:

“Hasbro updated the 60-year-old game of Clue with changes that include a fancy new mansion with a spa and theater, and new weapons like a baseball bat and an ax. Professor Plum is now an Internet billionaire and Colonel Mustard is a former football star.”

A spa in the mansion? Was that really necessary? I guess it might at least make poor kids feel better by convincing them that greedy rich people get what they deserve in the end. If Mrs. Peacock can’t be bothered to drive five miles into town for a pedicure, she probably deserves a wrench blow to the head. Now all we need is a version where Miss Scarlet can meet an untimely end from an unfortunate dermabrasion accident. That’d teach kids a valuable lesson about what happens when a 60-year-old woman refuses to age gracefully.

I’ve been thinking lately about the power of celebrity and the power of Britney Spears, specifically. It’s easy to be in awe of celebrity earnings when we hear about movie stars who make over $20 million for a few months of work or musicians whose concerts generate ticket sales in the hundreds of millions. But what about all of the hangers-on? What about the magazines, gossip websites and TV shows? What about the relatives who suddenly find themselves swimming in money from tell-all book royalties or a sudden interest in their mediocre talents?

It turns out someone at Conde Nast Portfolio had the same question back in February 2008 and decided to do a rough calculation of the total value of “The Britney Economy.” The article estimates Britney’s “gross domestic product” at roughly $110 to $120 million a year, which is truly staggering. Equally shocking was the author’s finding that revenues from unauthorized Britney photos account for 20 percent of the entire Hollywood paparazzi business. Yet, what’s really fascinating about the total value of the Britney economy is how LOW the $120-million-per-year figure might be. The author’s calculations fail to take into account so many other smaller but noteworthy revenue streams, including:

1. YouTube ad revenue from the hundreds of millions of views that Britney-related videos generate.
2. Ad revenue from websites like PerezHilton.com and TV shows like Entertainment Tonight. Granted, gossip magazines, websites, and TV shows don’t really depend on Britney for income, but some small part of their profits have to be considered at least loosely tied to her fame.
3. T-shirts, posters, and other Britney-related merchandise, including the occasional lock of hair or sweaty towel sold for thousands on ebay to some creepy superfan who is probably stitching it all together into some kind of Britney-DNA-infused catsuit.
4. Exploitative books “written” by Lynne Spears
5. The entire career of Jamie Lynn Spears, including all ad revenue and merchandising from her Nickelodeon TV show, Zoey 101, as well as modest paparazzi and gossip media revenue from her pregnancy.
6. Total ticket and DVD sales of Crossroads
7. Boosted ad revenue from Britney’s key appearances on TV, such as her disastrous performance at the 2007 VMAs, her much-hyped cameo at the 2008 VMAs, the MTV documentary, For the Record, her recent performances on foreign awards shows and Good Morning America, and her stunt casting on How I Met Your Mother.

With all this in mind, I’d estimate Britney generates revenue of closer to $150 million a year. Initially, this seemed like a ton of money tied to the influence of a single person. But then I did some digging and saw that Yahoo! finance estimates the approximate 2007 revenue of Harpo Entertainment, Oprah’s production company, at $345 million. That’s not counting all the money Oprah makes for others every time she promotes a new book club selection, names a product one of her favorite things, or launches the career of friends like Dr. Phil, Rachel Ray, Nate Berkus, or Dr. Oz. Britney’s also no Martha Stewart when it comes to generating wealth, since the total 2007 revenue of Martha Stewart Living Omnimedia was $328 million.

With the economy in shambles this holiday season, I hear the same two questions again and again from my readers:

1) How can I continue to give unique, luxurious gifts that my friends will adore without breaking my budget?

2) Where can I find gifts that bring back memories of a happier, simpler time—a time when all of us could achieve our dreams, even if that dream was to start an interior design firm staffed by headstrong, opinionated women and a sassy black man with a criminal record?

Well, dear reader, you need look no further than FrugalFag.com/Fashion. Why, you ask? Because, from now until Christmas day, when you order a Night the Lights Went out in Georgia T-shirt, you’ll get a second shirt absolutely free! After selecting the size of your first shirt, mention in the PayPal “instructions for merchant” area if you’d prefer a small, medium, or large* for your additional tee. (You should see a link that says something along the lines of “add special instructions for merchant” which will let you add a note, or you can just email me at frugal[at]frugalfag.com with the info.)

Keep one for yourself! Use one as a hilarious and absorbent way to clean up after sensual encounters! (Nothing breaks post-coital tension like a Julia Sugarbaker quote-fest.) Give one to a straight man and laugh at his confusion when older gay gentlemen flirt with him at the mall! The benefits of owning this timeless tee are endless, but this offer is not, so act now.

*I don’t want to cause a panic, but I feel I should mention that I only have two more larges and I’m not planning to print more any time soon. (Let’s just say I may have overestimated demand for Designing-Women-themed apparel, especially among skinny twinks.) So, if you have your heart set on a large, don’t delay.

S|Sense is a clothing boutique in Montreal that sells ultra-hip, high-end clothing for men and women. They’re having a 30%-off-everything sale until December 1st, so this is a great chance to treat yourself to something you’ll love and wear for a long time. Here are a few of my favorite picks from the outerwear section:

Mackage Seal Mix Grey Overcoat (Shown in photo.)

Refrigiwear Blinket Brown Jacket

Diesel Weighy Black Wool Peacoat

Energie Jabyl White Jacket

Energie Arhus Blue Jacket

Drykorn Basel Black Coat

If you’re on the hunt for an HDTV this holiday season, the options and jargon can be a bit overwhelming. I just came across this HDTV buying guide from buy.com that can be a good starting point if you need help with the basics.

I’m shopping around for a big, bargain-priced TV myself these days, and I’m planning to write a short post on the subject when I finally settle on what I’m buying and where I’m buying it. In the mean time, I will say that this 46″ Sharp Aquos at New Egg for $999 has caught my eye, and I’m also interested in this 52″ Sharp Aquos at buy.com for $1,199 (after rebate). Just FYI, I’m not on Sharp’s payroll. It just happens that the best prices I’ve seen so far on TVs with fairly good reputations have been Sharps. (Update: I just read some bad reviews of the Aquos models I was checking out. I’ll try to post a follow up soon.)

Back when MP3s were just a glimmer in a programmer’s eye, albums were treated with more reverence. It wasn’t just that more people purchased CDs, it was that putting a disc in your CD player and firing it up required a certain level of commitment and patience. Sure, you could change your mind and put in something else, but it wasn’t an easy task to wedge a disc back into its proper sleeve, find another, extract it, and insert it into a tiny slot in the dash all while staying between the lines at 70 miles an hour.

Digital music players have made it easy for all of us to develop a bit of musical attention deficit disorder. I rarely listen to my favorite old songs any more, and when I do, my mind wanders and I find myself skipping to something new before the first song is done. It’s hard to imagine going back to the days when all my musical cravings weren’t just a click away, which is why I was dismayed to find the car I rented a few days ago for a business trip had no auxiliary input jack.

Although I was initially sad to leave my iPod at home, I tried to look on the bright side: my road trip would give me a chance to reconnect with some of my favorite oldies. So, I dusted off my CD collection and spent several minutes arming myself for the five-hour drive. To kick off the trip, I listened to my favorite songs on Relish and remembered how much I love the raspy grittiness of Joan Osbourne’s voice. With nearly fifteen years to forget how overplayed “One of Us” once was, the song suddenly felt like a quaint, undiscovered gem. I stared out at the monotonous, corn-flanked highway and smiled, remembering how Joan made every rebellious teenage girl in America want a nose ring of her very own. I also spent some time with Aimee Mann and I listened to several of Michael Jackson’s greatest hits, recalling where I was when the music videos for “Black or White” and “Remember the Time” premiered. I brought along Emotions to ensure I’d have a little classic Mariah on hand, and I observed a moment of silence to mourn the day she traded in her sensible tops and jeans for hoochie shorts and airbrushed tank-tops.

It was nice to spend quality time with all of my adolescent idols, but one diva kept me company longer than any other. Her growling, powerful voice always takes me back to a simpler time when I still thought I might be a straight boy who just happened to be very into good skin care, musicals, interior decorating, and getting out of gym by being a teacher’s aide. I’m speaking, of course, about Taylor Dayne.

Now, I realize some of you might not be familiar with all of Taylor’s work. I can understand if you don’t own two copies of Soul Dancing, and if you’re straight, I could probably forgive your failure to purchase the maxi-single of “Naked Without You.” But if you don’t own Taylor Dayne’s Greatest Hits, I’m afraid we simply can’t be friends any more. It’s nothing personal. It’s just that Taylor Dayne songs elicit certain involuntary responses in me, such as singing into hairbrushes and/or broom handles and taking both hands off the steering wheel to punctuate choruses with faggy swishing and pointing. I find I eventually sabotage all relationships with people who lack this reflex. I’ve never completely forgiven my mother for botching the lyrics to “Tell It To My Heart” during our 2002 Christmas karaoke performance, so I’m sure you’ll understand that I can’t have blog readers who don’t even own her seminal compilation of timeless high-energy hits and sultry ballads.

Taylor Dayne was no one-hit wonder, but most people forget how many of her songs they actually know. Fortunately, there’s a convenient megamix of her greatest hits on YouTube if you need a refresher. However, to truly appreciate Taylor, nothing beats the inconvenient, high-fidelity glory of a compact disc. It may not be as easy to click and shuffle your way to another artist when your attention span wanes. Yet, listening to at least a few tracks from the same album gives musicians the respect they deserve and honors the dignity of their work.

Now, if you’ll excuse me, I have to listen to every track on several CDs I fished out of a dumpster behind a pawn shop in 1998. Looking over these albums after my road trip, I find myself asking what hundreds of thousands of CD-buying teenagers must have asked many years ago: could there be more to Aqua than just “Barbie Girl”? Could “C’mon ‘N Ride It (The Train)” be just the beginning of a musical revolution brought to us by the Quad City DJs? Only an open-mind and a two-hour listening party will tell.