This is the eighteenth part of Money360 Book Club reading of Your Money or Your Life. Want to know more?
Today, let’s look at the rest of those 101 sure ways to save money, this time focusing on the groupings of tips starting at #50.
I find that the one thing that many people do that hurts their financial shape is shopping for groceries every day or two or three instead of compressing into weekly (or, even better, every two weeks) shopping trips. This means two things: first, in order to make it work, you have to plan out meals several days in advance, and second, in order to pull it off, you have to make a list of the ingredients for these meals, ensuring that you have to be focused in the store. What works even better is pulling out a grocery store flyer, looking for the produce that’s on sale, and using a few of those items to center meals around, use that info to develop the meal plan, then build your list. Another tip: avoid convenience foods and instead make everything from the most basic ingredients possible. This philosophy (and a love of making my own food) has pushed me to the point of making pizza dough and sauce from scratch when we have pizza.
I actually really enjoy camping vacations, and they’re extremely cheap. Most modern camping sites have most of the amenities you essentially need at a hotel (showers, sinks, etc.) for a fraction of the cost of a hotel room. In fact, we went on a camping vacation when our son was about eight months old with no real problems – in fact, it was one of the most enjoyable vacations we ever had.
Entertaining and Dating
Remember that part about not putting up appearances for others? That comes through here. Basically, the book argues that the real reason you spend time socially with others is to enjoy their company, not to spend a bunch of money. The advice follows that logic – have potluck dinners or spend a day where you and another person (or couple) spends half the day doing a large task at one house and the other half on a task at the other house. You get some big tasks done and get to also spend the day being social. As for dating, why not just keep it simple and have simple meals at home and watch a film sometimes instead of going out and blowing big cash? After all, tip #83 says the nicest part of dating doesn’t cost money!
The best hobby is one that’s truly cost-effective. For me, I like to find hobbies that simultaneously enrich me and also cost less than a dollar per hour of enjoyment. Reading (thanks to the library) usually fulfills that goal, as does writing and often video games do as well as long as I focus on inexpensive games and play them thoroughly (and also enjoy free online ones, like my perennial favorite Desktop Tower Defense). Bad hobbies? Anything that sucks down money, like, for example, Magic: the Gathering or golf.
The advice here is simple: look at your life and ask yourself what scenario causes you to cash in your insurance. Now, could you (or your loved ones) do fine if you had less insurance coverage? For example, I don’t need as much life insurance as many guidelines suggest. Why? My wife is college-educated and has a very good job. I carry quite a bit solely to fully pay off our home and both of our children’s college educations if I were to pass away. Think of your insurance (homeowners, life, and auto) in terms of your actual life, not in terms of vague guidance.
Most of the advice here is covered well in the books The First National Bank of Dad and Make Your Kid A Millionaire, both of which I reviewed and liked. Your Money or Your Life is in favor of allowances and also setting examples on how to spend money for your children, both of which are pretty strong ideas.
I found their take on college to be interesting, though: they’re big advocates of not automatically sending a child to college and paying for it. Instead, look at the broader picture: some children are better served going to a trade school (electrical, plumbing, etc.) instead of college, and still others benefit from a few years in a volunteer program first.
The final section, on gifts, nails exactly how I feel about giving my children presents: fewer is better. That doesn’t mean go cheap on them – just give them one to three carefully selected, quality presents instead of a pile of junk. My memories of Christmas gifts are of the great, well-thought-out gifts my parents got me, not of the piles of stuff I didn’t really want or need. I also like the idea of exchanging “services” as gifts, something one of my wife’s aunts did brilliantly at a recent baby shower for our second child. In lieu of a gift, she offered to watch our children for a night and allow us to have a romantic evening together. Guess what our favorite gift from the shower was?
Tomorrow, we’ll finish up chapter six, “The American Dream – On A Shoestring,” focusing on the final piece of the chapter starting with “Save Money, Save the Planet.” This section appears on pages 213 through 218 in my paperback version of the book.