"Whoopee, we can spend again!"
I was poking through my worn copy of The Complete Tightwad Gazette
last night and came across an article with this title. I thought it was so good, I really wanted to type up the whole thing and share it with you here.
But I'll just summarize instead.
You're welcome.
In the article, Dacyzyn is talking about people's tendency to base their spending on their current economic conditions...when cash is flowing, spending tends to go up. And when times are hard, people trim back because they have to.
Of course, being the frugal zealot that she is, Dacyzyn recommends living at a modest level no matter how the income level fluctuates, and I tend to agree with her.
Why?
Because if you know how to live a rich life without a lot of money, you can weather the financial ups and downs of life pretty darn well.
During good times you can live happily on less than you make, sock away money for a rainy day, and give generously.
And during bad times, you can still live a rich life, and your savings should get you through most disasters.
Conversely, if your spending curve follows your earning curve closely, you won't have much in the way of savings to carry you through the down times. And if you've become accustomed to living large, down-shifting your life during the bad times will probably feel sort of...awful.
A few years ago when Mr. FG's company decided to outsource all of their IT jobs, we were facing the prospect of unemployment. Though we certainly weren't happy about it, we were a great deal less terrified than we would have been if we were saddled with debt, and had no savings or frugal skills...we were so thankful to be in fairly good shape for facing unemployment.
(Here are three ways we prepared for unemployment.)
Here's a quote from Amy herself that's too good to summarize:
"To some, constantly cruising a long at a spending level that's near the bottom of a family's cyclical income sounds like a life of permanent deprivation.
But if there is one thing I'd like to hammer home, it is a new definition of deprivation.
To me, [real] deprivation is a lack of security-the constant nagging feeling that the tiniest downturn in one's income, or the smallest domestic disaster such as a blown engine or broken window, can wipe you out.
We don't place much value on this feeling of security in our culture because it doesn't have an ad campaign on TV, it's not promoted by our political leaders, and it doesn't surround us with lots of visible stuff with which we can easily impress our neighbors.
But anyone who has live without security and then slowly, patiently acquired it knows that it's more satisfying to own than any consumer gadget."
Preach it, sister!
Now, if you've been reading here for a while, you know that I'm not opposed to thoughtful lifestyle inflation. And you know that I don't advocate living a miserable, deprived life either.
What I do encourage is living within your means by wisely choosing frugal activities.
Ooh, and learning to be content with what you've got will help you to save during the good times and keep your chin up during the bad times.
If you're experiencing an up-turn at the moment, seize the golden opportunity to save for the future.
And if you're in the opposite situation, use this time to learn how to thrive on less (with some creativity, you might even be able to do some saving), and then when times improve, you'll be in a great place to save and give.
P.S. If you haven't read The Complete Tightwad Gazette yet, you totally should. It's a little extreme in places, yes, but a browse through that book always reignites my passion for frugal living. Your library should have a copy, and half.com usually has some too. Even a brand new one at Amazon is only $15, and it's an enormous book.
_________________________
Today's 365 post: The jeans drawer WAS getting a little empty...
Joshua's 365 post: My bottlecap collection
Amazon links are affiliate links.
what a great reminder! thanks. i needed that this morning.
I will second the great reminder comment.
What is in the glass jar?
That's the dressing for Mandarin Orange Spinach Salad: https://www.thefrugalgirl.com/2012/02/mandarin-spinach-salad-with-sugared-almonds/
Totally delicious.
i always look forward to reading your blog because it is just what i need to here and i love to try the recipies...i have done childcare in my home for 18 years and i am going to trim down to 1 when school starts back up..(i have teachers kids) and reading your blog has helped me to be able to do that..thank you for all you are doing..
hi, i have followed your blog for quite some time and enjoyed it though i seldom comment as there was no need.
but this post and its common sense advise prompts me to break my silence.
i think so many do not follow it , even though they know it makes sense and the reason is this... How will u be able to refuse friends' invitations to meet up for a coffee , or a restaurant for dinner, or to a cinema for a film show, or theatre for a play, or a special exhibition? or to join them for some social shopping or weekends away, if u refuse often enough, your friends will stop asking you. and yet all those activities involve spending money.
i think if u have a close family so u get all your socialising and human interaction within the family, u can ignore making friends outside that circle. but not all of us are that lucky.
some might say why not entertain at home so u can still have friends around and keep in touch with them... but i say keeping in touch is not the main reason for meeting up, (u can keep in touch via email, or phone or via any of the social networks). the friendship is strengthened when u do things together, and doing a variety of things, not just entertaining each other at home.
any thoughts on this? my experience is that there is a social price to pay by being frugal. either i save and have friends drift away, because i dont go out with them that much anymore, or i spend and go out and be more social. it would be nice to have both but if i have both, then it means i save less.
Thankfully I have fairly like minded friends. None of us are big spenders (some by choice, some by circumstance) when it comes to frugal activities. Instead we do active things that don't cost much, if any, money when we get together. For example, try a game night (board games, card games, etc.), a free concert in the park, storytelling events at your local library, hikes, walks, picnics, cooking new dishes together (four of us learned to make Sushi for a fraction of the cost at a restaurant), campfires and smores, community events, etc.
Honestly, I rarely spend any money when I'm with friends these days, and we have plenty of fun. It's taken creativity, but I enjoy my time with friends more now than a few years ago when all we did was go out to dinner all the time. I think a frugal lifestyle can actually improve friendships if you think outside the box. 🙂
I live in an expensive city, and my social life is a bit like that too. People are mostly not interested in entertaining/being entertained at home, and like to go out to nice restaurants and other events. I agree that if you say no too often, people will stop inviting you, which can lead to loneliness.
Like anything that you decide is important, you must simply work this into your budget (assuming you have money in your budget for discretionary spending). For example, if you choose not to travel, you could instead budget more money for your social life. Maybe don't have a car. Maybe live in a smaller apartment, or with a roommate. Maybe take an extra job on Saturdays. There are ways to make it work if it is important to you, but it will mean sacrifice in some other area.
I think that there are three answers to this question, all of which should be blended together to find the answer that's right for you.
1) Budget (if you can) a certain amount of discretionary money for entertainment.
2) Counter-offer with a more budget friendly activity. This doesn't nessescarily mean hosting movie parties at your house as opposed going out to the movies.... It can also mean saying something like, "Hey, I can't join you guys at Tres Expensive tonight, but, I'd love to have you guys stop over before you go there for a glass of pre dinner wine!"
For social shopping, if your will power is high enough, what you can do is take a pen/ paper/ make a list on your phone of things that you saw that you liked and their prices. Add them to a wish list. You'll find that once they've been on the wish list long enough, some things you will no longer want. Others, you'll start to get a good feel for their prices and can comparison shop from there.
Another idea is to keep an eye on groupon/ living social, if they service your area, for groupons to things you regularly do with your friends. I've gotten some very good deals to resturants, movie theaters, plays and sporting events through them.
Also, you can do things with your friends at your house or at their houses. There's a lot to be said for a game night/ pot luck/ inexpensive dinner/ barbeque. If you have nice parks locally, you could even do some of the same things at your local park.
For the third idea.... Expand your social circle to include people who are cheaper "dates," if you will.
I really don't feel that there's any one right answer, but, instead, all three should be blended to find a mix that's right for you and your social and financial needs.
I would hope that one's friends would be sympathetic to one not wanting to spend a lot of money every time you see each other. Or be OK if one joins in but doesn't spend a lot of money (only works if not spending when others do, doesn't make you feel worse). Another way to keep being invited is to issue invitations yourself, even if the activity doesn't involve spending money. Here are some ideas that are common in most towns and cities in the US, or available anywhere:
- Pot luck meals at someone's house; BTW brunch is less expensive than dinner.
- Game nights, or TV nights if there's a show many of your friends like, or sports events, or home movie nights or ...
- Free movie screenings or concerts in the summer. For some outdoor venues (such as public parks) you can sit near the venue but not in it, and still hear the music.
- Picnics.
- Matinee movie, or movies at a brew-and-view if there's one in your area.
- Bookstore or public library lectures and classes.
- Craft store events, if y'all have a craft you do or would like to try.
- Ditto outdoor athletic stores such as REI or bike shops.
- Street festivals.
- Many gyms and yoga studios have a time during the year when you can go for free (a weekend, a class, etc.). It'll take some legwork to find this but once you have a list or are on their mailing list, it'll get easier.
- Ditto for museums, zoos, national parks.
- Outdoor athletics together, such as pick-up games or kite flying.
What works for me is that I tell prospective friends right up front I am a very frugal lady and I don't spend money foolishly. This causes them to omit me from future social events because they know #1 I won't spend the money #2 I won't use credit.
But here's the thing: most of these people who won't include me in their expensive social events (like go to NYC Broadway shows, out to dinner or just this past week some friends went to Aruba for a few days)......most of these people are in dire economic stress. They can't afford their mortgage payments (I have no mortgage. My home was paid for by age 50) they have problems each month paying their bills and truthfully, they get so stressed out over money it's ridiculous. Who needs it? Not I.
This just happened last week. One of my husband's big shot friends (like he used to buy himself $600 cowboy boots. And he lives in the city. Duh?) called and begged, begged, begged for he, his wife and son to stay at our house because they couldn't afford to stay at a hotel to attend their daughters graduation from college. Duh? Go sell your cowboy boots, big screen TV and your gas guzzling SUV.
Ugh.
We just asked him to pay to have a cleaning lady come in and clean up after they leave our home and he couldn't afford it! He said he and his wife will clean. Is they for real?
Anyway, I am glad I have been a frugal lady most of my life. I may not be able to attend a NYC top Broadway show, but I did see 'Hairspray' at our local theater here, plus dinner afterwards and hubby and I laughed all the way to the bank.
My advice: stick to your frugality. If people won't be your friend because you won't spend money, you don't need that kind of friendship. I stay close with my family and I have a small circle of frugal friends. Life is better when you have much in common with friends and family.
Love The Dacyzyn. Thanks for the great early morning reminder.
The waiting list for the Tightwad Gazette at the library is always hugely gianormous. Which if you think about it, is kind of great. I should really use some amazon bucks to buy a copy.
This is a great and timely post, Kristen! I just saw a youtube video with Amy saying the same thing yesterday! I have the book, and it might be time to take another look...
Remember if your library does not have a copy of "The Complete Tightwad Gazette" they can order it for you from another library. It will either be free or cost you a nominal shipping charge.
From a librarian
My public library charges $5 for interlibrary loan. I can usually find a used copy on Amazon for that much, including shipping. Then I'm stuck with a dilemma between efficient use of my money or supporting my public library.
That is one of my favorite posts. I love her comparison to Roseanne's show because it was how the Connors lived.
I find if I am frugal in some areas, such as having a Trac Fone instead of the smart phone I wish I had :), I can spend more on organic groceries, which is more of a priority than the cell phone I have.
So true. My mom and step-dad are currently learning this the hard way! At 22, I am thankful for blogs like yours with your mindset. Youve been quite a good virtual role model for me! Ha:)
Very good entry indeed. I wonder if you notice how you are really getting extremely thoughtful these days and helpfulness goes with it! truly one of the best blogs around on all topics.
Our life went pear-shaped economically some years go when we both returned to graduate school, along with two teenagers in the family. We did the same thing--we had minimum-wage jobs at the University of Texas at Austin and lived on bare bones for 2 years--really a worthwhile experience. From January of next year my husband also retires (I did a few years ago) and we have worked out that we can live frugally but well on just our social security if ever needed to or, conversely, we can live equally on just our private pension incomes.
I can pick up private lecturing (do so off and on--dependent on my rinky dink health which had caused early retirement) and he already has been offered part time advisory work. Meanwhile we are getting all the expensive things done and have just had the house re-roofed, house re-mortgaged at a much cheaper fixed rate, bought an economical small car and I could go on...but this last year we are living on the future retirement amount and have barely had to pull in our belts at all.
It is our early experience that makes us feel very secure and last year when my son-in-law lost his job and it took him 6 months to work up his own self-employed business--when he then received a good job offer, like a reward from Heaven, and accepted it, my daughter knew from those earlier family years for us all that they could manage on her much smaller salary alone and they did so beautifully; we are so proud of them and their children, now 11 and 15, join in family financial decisions (reading this over I'm proud of my husband and I also--it takes some doing but it is so satisfying)
I apologize for the length of this but it may resonate with some older readers. Job loss is not the end--it can really make the adrenalin flow and solutions appear.
I like how you put your thoughts out there in a clear and logical way that is easy to follow. And it is good, sound advice. (As an added bonus, you've made me want to re-read my Tightwad Gazette!)
Really nice post, Kristen. My husband and I are in a similar situation to what you described in waiting to see what would happen with your husband's job. I'm the sole breadwinner after my husband resigned from his job last year so that we could have one stay-at-home parent. My company recently announced that it would be divesting/selling pieces, including the piece I manage, so there's uncertainty. But with that announcement, neither of us felt panic; we have always saved, have always lived simply, and we can weather a period of uncertainty or reduced income without going underwater. That secure feeling is more than enough return on investment for shopping at Goodwill, packing my lunch, and driving older (but paid for!) cars.
I love my Gazette. Need to pick it up and browse again...my husband is self-employed and we've been through some really rough times. We learned fast that we needed to get rid of our debt (and we did) and I started learning ways to be more frugal. The Gazette was my introduction to that. So grateful for Amy.
It's funny because I said something very similar to this recently but in a different way than the title suggests. My wife and I are in the process of purchasing a home and so now it's fun to be able to spend money again (for what we were saving it for.)
Not the same thing but I can understand why some people don't act frugal when they don't have to. Spending money is fun. ^_^;;
It sounds like it's a good time for this post for a lot of people - I just finished categorizing our spending for the past 5 months or so and we're about to have to figure out how to cut a big chunk of it. I think it's time to pick up my Gazette and get a little inspiration - and motivation!
Anthony--yup, it can cost money to maintain friendships. We have young children so we typically have friends over for dinner--it saves money and it's more enjoyable for the kids to go play together in the basement after dinner rather than to sit quietly at a table in a restaurant. We are blessed to live minutes from Lake Michigan so in the summer, it's a very appealing option to take a picnic to the beach with friends. If you are creative, there are always options ... we happen to use the beach/hiking/fishing because of where we live but I can also tell you where I can get a 94 cent latte, where I can pay a maximum of $3/person for a movie, and what museums are free in our community. Just because you go window-shopping with a friend doesn't mean you HAVE to make a purchase . . . lunch prices in restaurants are typically cheaper than dinner prices . . . water is still free in our local restaurants and the savings from not purchasing a beverage often covers the tip . . . if you eat out less frequently you can save a little more money for when you DO eat out . . .
In summary: if you value the friendship, budget some "fun" money! A true friend will "get it" if you have a strict budget and will support you on this. Look for imaginative low-cost or free options for recreation--they are out there, I promise! Saving money is great . . . saving a friendship is more valuable to me.
SO true, at least about gaining an appreciation for security. The first few years of our marriage, any little thing put us in financial hardship. The few times payroll forgot to deposit my husband's paycheck (seriously?) we were out of money within two weeks. It was SO terrifying.
Now we've paid off debt and built an emergency fund. actually, we've had to build it up twice this year because we both keep losing work (we live in CA). Between unemployment and side jobs, I don't know how we've gotten a 3-4 month cushion in our savings account, but money just piles up when you intentionally put it aside. We got word from EDD that my husband's unemployment benefits are suspended "while they review his file", so we could be needing it again for the third time in a year. I'm so so SO grateful that we have worked to build it up immediately after getting any kind of income. The strain of no money is NOT worth going to the movies whenever we want.
I so agree with this! With my husband's old position, it was very seasonal work, so in the summer when weather was nice, he had a lot of hours - 60-70 a week. But then in the winter, he would have maybe 40 hours, or possibly even a few weeks of layoff. (Thankfully my hours always stay about the same, 45-50 a week) We knew that so we would average everything out and spend as much during the summer as the winter. If we didn't plan ahead for that, and just increase our spending in the summer, I can imagine the winters would be pretty tough for us. A lot of his co-workers didn't plan ahead and they would be real distraught when winter came
I need to hear this, because this is my problem.
I'm good, I think, about not living above my means. I never spend money we don't have. But, I feel like I'm always spending all the money we do have. Living below my means is something I struggle with.
I used to spend everything I brought home even though I never went into debt. I'm only doing better on this one because of a post on this blog. I opened several ING accounts. On the first of each month (I get payed on the last working day) I have several withdrawals that go into ING savings accounts for various future needs. That money is gone so fast that I never really see it ad have the chance to miss spending it. My spending has grown exponentially in the past year as a result.
I meant my SAVINGS has grown exponentially in the past year as a result. Oops!
Now, that WOULD be sad if your spending had grown as a result of reading my blog. Hee.
Love The Tightwad Gazette! I read it once a year to be reminded that the life of "The Joneses" isn't the only way to go. But you left out my favorite part of that particular article: the graph! (what can I say - I'm a math/science geek.)
Love the "Tightwad Gazette". Such a great book. Everyone should read it!
I just emailed with Amy about my project. She's really a lovely person. Wouldn't it be great if we were all neighbors? She still lives in her house in Maine and has retired from the writing biz, but not from the tightwad life. She remains busy, often babysitting her grandchildren.
There's a nice video interview of her on youtube - http://www.youtube.com/watch?v=AUFyD-FTf-E
I am big on the security of having no debt. A few years ago we were able to pay off our house early, and we had no debt other than the house. What a great feeling! Especially a few years later when DH lost his job. I was a stay at home mother, so we had no income other than unemployment, then DH became very ill and couldn't even get unemployment (they don't pay unemployment compensation if you are too ill to work). He was out of work for 21 months, and when he did find a job, we had to move to another state. We are currently paying off the moving truck, but we have weathered everything because we started out with no debt and a frugal lifestyle.
My husband finished his grad course work in 2009 and it took us 2 years to find employment (NOT for lack of trying) during which we were both working part time and he was finishing his thesis (took WAY too long due to complications.)
During that time we lived in my parents basement (not my first choice...) with our son (6 months to 2.5 years when we finally moved out). However, when my husband finally got a job we were able to buy a house because of the way we had lived (no excess spending, etc). We didn't have a huge amount of savings (but were able to get a loan where we didn't need a down-payment - it cost us 4,000 extra but it worked for us as our monthly mortgage payment with Escrow is LESS than an apartment would have been.)
There is a huge desire when you haven't had money for a while to want to just spend (and for us there were some things that we actually needed - especially since we bought a house!) There are still things we need to buy, but we made a list and prioritized it and are working towards it while still saving some money.
In contrast, my husband has a co-worker whose wages are being garnished due to not paying off debt and whenever he and his wife get extra money (work bonuses, Tax return, etc - they spend.) My husband mentioned once that his bonuses (he gets quarterly bonuses 🙂 get cut into thirds - 1/3 to pay off debt (currently on our student loan then to our mortgage), 1/3 into savings and the rest we get to spend. His co-worker kind of laughed at him and said they planned on spending the whole thing. I would hate to be them if they fell upon hard times!
Living below your means works best when you have a certain amt of income. As it is with my husband working more than full time we still have just barely enough to pay our small mortgage, buy food and second hand clothes and heat the house, although not enough. So any little raise he gets means we get to replace the kids already glued back together shoes and buy a few more ingredients to make more home made from scratch food to feed three growing kids. We don't go out and splurge on lattes and movies, or luxury items. We spend those raises on actual NEEDS. Like keeping our paid off car running so my husb can drive to work.
I get where the theme of this kind of message comes from, but it also comes across as if anyone who isn't living below their means just isn't trying hard enough, or doesn't have the right priorities. Some of us do have our priorities set right, and we still barely get by.
I had my mom, who was the ultimate penny pincher when I was growing up, take a look at our budget to see if I was missing some way we could cut back. We literally budget every penny that comes in, and still have no room to give to church or savings or retirement AT ALL. My mom was shocked at how little we spend on food, and agreed that we were doing all we could with what we have, esp given that two of my kids are disabled, and one has had over 30,000$ in medical bills this year alone.
Good point and I'm glad to see it make explicitly.
I'm sure that the implication you feel was not intentional and thank you for bringing it up.
Gah, I meant to put something in the post about this and didn't...my apologies. I understand where you're coming from because Mr. FG and I have definitely spent some years in situations similar to yours. There are most certainly circumstances where living frugally only brings you to a "getting by" sort of state, and those circumstances are definitely not what Amy or I were addressing. If I can presume to know where she was coming from, I'd say that she and I were both thinking of people who have the, "Whee! Now we can spend more money!" attitude, not those who are working super hard in order to survive.
Could not agree with this sentiment more!
We watch the pennies...regardless of economic climate....
It's being reported that the UK is once more about to go into recession (didn't realise we'd come out of it!). I've just posted about how I've cut back further and stopped paying for school meals (I liked the 'idea' of a hot nutritious meal that supported the school, however...) - I did a cost comparison and over 7 years of primary school life you could save £2,ooo per child by packing their lunch. I love the BIG figures! I've tend to think in big numbers, maybe that's why I'm able to curb my spending, even when it looks insignificant. A penny here and there - who notices, but look at the lifetime of those pennies, and you may see a whole different picture.
(PS There's a great frugal vibe going on over here at the moment, and I'm loving it. If it's one thing tough economic times bring, it's ingenuity and creativity.)
Amen! I'm also curious about what's in the jar. It looks like a yummy salad dressing. What's in it?
Yep, it's the dressing for Mandarin Spinach Salad: https://www.thefrugalgirl.com/2012/02/mandarin-spinach-salad-with-sugared-almonds/
HA! I think that is my favorite (and most memorable) article from the Tightwad Gazette. I often quote it to friends and family. It is a great reminder, especially after living through a lean patch in life. It may be sunny now, but it will definitely rain again later. Better be prepared.
What a great post, Kristen! It's so wonderful reading your insightful posts. I definitely agree with everything that you say.
I think it's really discouraging to see so many people who live way beyond their means and then don't know why they don't have any money. Every time there is a little bit extra it all gets spent too. My dad always spoke of the proverb that states that it's not how much money you make, but how much money is left after you spend it that matters.
I guess it really all comes down to behavior and the choices we make on a daily basis. Our society today doesn't like to wait for anything. We are so consumed with getting what we want at that very moment. It's no longer common to save up for something but instead people just get it on credit and then live in debt.
I grew up in a family of immigrants and my parents were very conscientious about spending and saved up for what we needed and wanted. In fact, my dad built our house a little at a time instead of borrowing a lot of money. I am so proud of them. Not only were my parents frugal, but they worked very hard to achieve as much as they could. My dad has his own business and my mom got her RN license while raising 6 children. America is an incredible country, and we are so thankful and proud to be American citizens. We really are blessed in this country, yet so many times we take it for granted and don't make the most of the opportunities that we have and make wise decisions about what we do have. My husband and I are in the process of adopting 2 children from Russia, and we are so thankful that working hard in this country allows us to be able to do something that has been a dream of ours for so many years.
Absolutely right! I love TTWG!
Currently, we have a mortgage, a car loan, a renovation loan from the bank and a renovation loan from my parents. All our fixed monthly outgoings are covered by my salary. My dh makes less money, and what he earns is spent on the non-fixed needs (clothes, savings, etc). We are saving hard to pay off our loans, and hope to bring our monthly fixed spending to less then dh's pay. Then, we can use my salary to pay for extra pension, travel, haircuts, etc. (of course, after we have saved at least 6 months' worth of expenses). I really hate to see so much money going to something that we already own; it doesn't feel 'mine' yet.
Wow I haven't heard of that book in a loooooong time. My mom had a copy that I used to sit and page through and find fun crafts and ideas I could do as a kid. Thanks for reminding me of it, I might have to find it at the library. 🙂 Thanks for these tips too!
Like some of the other post, I read the blog very regular, but do not usually post. However this one was great! I have not looked at the tightwad book in a long time, so I bought it for the collection off amazon. I usually buy used in good condition. With shipping I am paying around $8 for something I will have to reference and share for years to come. Also I wanted to give my two cents on the social aspect of living frugal, we love our friends and socializing. We just went to the circus last night, here is the difference all of our friends bought their tickets from the website directly, we bought ours from a google search link and we paid $ 25 for a family pack. Same seats, great night out, but the other families paid $45-$69 for the same family packs. Being frugal for us does not mean giving up friends and social situations, it sometimes means for us just taking a minute to research for a coupon or code!Just wanted to say thanks for the great post and book tip! Love reading your blog with my coffee! Have a good weekend!