Clever Money: Sharing My Secrets. Hoping That You’ll Share Yours.

For the first few years of our marriage, I felt like Diane Sawyer every time I met someone who seemed to be living frugally. I wanted to pry deeply into their financial psyche and ask a million questions about the fiscal details of their life. I am every bit as anxious now as I was then to learn from people who seem to know a thing or two about living well, while living well beneath their means. I’m certainly not an expert when it comes to financial matters, but here are a few ideas I’ve picked up in my quest for frugal living.

1. Make a Budget. Yep. I said the “B” word. My husband recently received some training on financial advising and one piece of advice he received was, “whatever you do, don’t say the word budget. Call it a ’spending plan.’” You can call it tropical paradise if it’s really a matter of semantics, but whatever you call it, the most important thing is that you live by it. I never thought I’d hear myself say that–let alone tell anyone else to do it, but we’ve been living on a budget for four years (though only about 2 years of that’s really been effective.) I used to think budgeting sounded like a tightly cinched financial corset, but now I realize that we’ve got to live within our means whether we plan it out or not, so we might as well plan and choose where we’re going to spend our money rather than just spend it willy nilly ’til it’s gone. The thing that really helped me understand our limited resources was living on cash–the old envelope system. We did it for several months in college and it knifed me to the core to pull out a bill every time I wanted to buy something. I also realized that if I overspent at the grocery store, I had to take that money from some place else (literally) which meant there was less to spend on entertainment or gas or whatever fund I borrowed it from. We don’t use the envelope system anymore, now we use YNAB software (visit www.youneedabudget.com for more info) and have a monthly budget pow wow about how and where we’re going to spend our money.

2. You don’t have to have a lot of money to have fun. Here are some free (or almost free ideas) that I thought sounded really fun.

• Adopt a holiday from another country and celebrate. Plan a Chinese feast for Chinese New Year or eat crepes and watch classic French films on Bastille Day.
• Check out the local museums and find out when they offer free admission nights/days. Here in Dallas the art museum is free to the public the first Tuesday of every month and every Thursday evening.
• Shake up the evening meal routine by serving breakfast for dinner and have everyone come to the table in their pajamas.
• Celebrate twice as often with half birthdays: serve half a cake, buy a small gift, and give the birthday boy/girl the royal b-day treatment for half a day!
• Buy your spouse or child a small gift and then set up a scavenger hunt that will lead them to it. Nate bought me a Venus razor one time and hid clues all over the house that finally led me to find my new razor in our shower–it was SO much fun!
• Celebrate the birthday of a historical figure that you admire. For example, find out when Mozart was born. Plan a celebration with Austrian cuisine, play his music and have someone prepare some biographical information that they can share with the family. If you’ve got a musician in the family, have them give a concert of his works.
• We don’t have kids old enough to do this yet, but I would have DIED if my mom had done this for us. Play Hooky! Surprise your kids by taking a day off work and keeping them home from school. Plan a fun outing or just hunker in at home and watch a movie, bake cookies, play games or make a craft. They’ll think you’re the coolest of all cool parents!
• Camp in the living room or in the backyard. Set up the tent. Roast hot dogs and marshmallows in the fireplace (or just make them on the stove if you don’t have a fireplace). Tell ghost stories by flashlight. This is better than real camping in many ways, you get to shower in your own shower, use your own bathroom (you could even sneak into your own bed after everyone else was asleep if you really wanted to…none of which can be done at the campground in the sticks!)
• Set aside a day in which you’ll do things opposite of how you normally do them. If you’re sports fans, go to the symphony. Eat dessert first. Switch up the family chores–if mom usually makes dinner, have the kids do it. If you usually eat in, go out.
• Volunteer together (and not just around the holidays.) Visit a nursing home, an animal shelter, a lonely widow or a soup kitchen and serve someone who could use a little cheer.
• Go for an ice cream cone. It’s a tasty date for less than $10.00. Then go for a walk or a drive and ask each other really important questions like, “If you were an animal what would you be and why?” “If you could go anywhere in the world tomorrow, where would you go?” “If you could be on Oprah’s Wildest Dreams show, what would you ask her to do for you?”

*Some of these ideas were taken from the September 2006 issue of Real Simple magazine. The article is called “New Family Traditions.”

3. Use cloth rags or towels instead of paper towels. It’s easy to clean rags if you buy white ones and soak them in a sink of water and bleach–they’re clean and sanitary in 10 minutes and they’re earth-friendly as well.

4. Thrift! ( I love this one!) Shop the second hand stores in your area. Look for good garage sales, consignment sales, and estate sales. I especially like to visit the thrift stores in the wealthier parts of town because you can find high quality, brand name items for a few bucks. I regularly find items from Banana Republic, J.Crew, Harold’s, Nordstrom’s, Gap, etc. at our local thrift store. Find out what day they put their new inventory out and go then; you’ll get first dibs on the treasures. Beware though, just because it’s second hand doesn’t mean it’s the best deal, especially if you’re shopping for kids’ clothes. If you watch the sales at department stores and places like Wal Mart and Target you’ll be able to find brand new clothes on sale that are often cheaper than what you’ll find at a thrift store. The other day I bought a shirt/short set for Henry at Wal Mart for 2.99 — that’s better than any price I’ve seen at consignment or thrift stores. Also, Henry has cycled through several sets of clothes now–some from GAP and Gymboree and others from Wal Mart. I have not noticed a tremendous difference between these clothes. In fact, in some instances I’ve been really unimpressed by the quality of the uppity brands. Kids wear clothes for such a short period of time before then grow out of them that it’s almost impossible for them to get worn out. I understand buying higher end brands if you plan to have several kids and want to keep the same clothes for all of them. I also understand and recommend buying well-made adult wardrobe staples like white blouses, black slacks, blue jeans, black dress shoes, etc. I think in the long run you end up paying less per wear for a higher-quality item than you would for one that is cheaply made. When possible, I say shop the thrift stores and consignment sales and buy them gently used for less than half of what you’d pay for them new. Also check on E-Bay. I bought a 20 piece lot of boys clothes for Henry (mostly reputable brands) for $30 (with shipping.) He’s been able to wear those clothes for almost a year. Just to give you an idea, here’s a snap of the clothes I recently bought for Henry at a local consignment sale–I bought him 12 clothing items (and 3 trucks) for just over $30. (This shirt really bumped up the total. It was $5, but it was so cute I couldn’t resist!) Other sites to see for bargains: Overstock.com, Shop.com, Craigslist.org, Etsy.com, bargainshopping.org, Amazon.com (for used books) and half.com. That’s just a teeny tiny start…I’m sure there are bajillions more out there.

5. Buy generic. Some things (a lot of things) just taste the same whether you buy the premium priced brand that’s packaged to dazzle or the plainly-packaged generic imitation. I buy generic pasta, pretzels, oatmeal, sugar, flour, butter, diced tomatoes, canned beans, paper goods, dish-washing detergent, salad dressing (some kinds), and a lot of other things! I must make the disclaimer that I am also not a food snob, so some of you with more distinguished palates may disagree. If food is your passion, make it your indulgence and budget accordingly.

6. Cancel your cable. Or at the very least reduce down to the basic cable package. If you have it, you’ll watch it. If you don’t, you probably won’t miss it and maybe you’ll develop a neat hobby or skill in the time that you used to spend in couch potato oblivion. We don’t get TV, but we get Netflix (which is $4.99/month) so we watch great movies on the weekends.

7. Adjust your thermostat–set it lower in the winter and higher in the summer. We keep ours at 68 in the winter and 80 in the summer. We’d probably put it even lower in the winter if we didn’t have Henry, but he doesn’t know how to stay under his blankets, so his only source of nighttime warmth is his fuzzy-feet cozies. There are also a lot of great websites with suggestions about how to lower your utility bills by doing everything from taking shorter showers to running your A/C every other day.

8. Don’t use your dryer. Hang your clothes to dry. I hang everything to dry except Henry’s blankie ’cause he can’t go without it that long. I got my drying rack at Target and I think it’s paid for itself several times over in money saved not running the dryer all day long. I also see this as one little way that I can be “green.” Imagine the aggregate effect if everyone hung even half of their laundry loads to dry–that’s a lot of conservation!

9. Move your savings to a higher interest bank account like Emigrant Direct or ING Direct. They don’t charge any fees and there is no minimum balance. ING is currently paying 4.5% and Emigrant Direct offers 5.05%. (Compare this with Wells Fargo’s annual yield of .10%.)

10. Pack a lunch. If you or your spouse works full time and eats out for lunch even twice a week that’s probably somewhere in the neighborhood of $15.00 per week (depending on how extravagantly you dine)…that’s $60/month, $720/yr! Think of all the things you could do with $720 if you didn’t spend it on hamburgers for lunch.

11. Choose an indulgence. I sort of mentioned this earlier in the “Buy Generic” segment. If you love to cook and eat and try new foods–make that your indulgence. Allow yourself to splurge on that, and try to keep the financial reins pretty tight on the rest of your expenses. If you’re a fitness buff, splurge for a gym membership. Make sure your budget allows for fun and enjoyment, but like I mentioned above, realize that indulgence in one area may necessitate parsimony in another.

I know some of these secrets may not seem very secret. Some might seem outright obtuse, but I’ve found them to be helpful. Now, it’s your turn. Leave a comment and share your tips for frugal living, the fun things you do for free, and your favorite venues for bargains. Please, I’m so curious.