A few weeks ago, I was let go from my job. Since then, my wife and I have kicked into ultra frugal mode. If we do not need it, we simply do not buy it. While we have seen cuts in all areas, the place where we really noticed the cut was in our food spending. I was balancing my checkbook this past weekend and noticed just how fewer debits there were than only a few weeks back when I was working. I started investigating a bit and realized, all these cuts were primarily on convenience food spending.

A long time ago (about the time I had my first child) my wife and I stopped most fancy restaurant dining (as in anything more expensive than $5 footlongs). The dining experience was simply too expensive, the food generally too greasy or salty, and the effort of dragging a baby into a restaurant way too stressful. So we started eating in a bit more. Instantly, all that cash I had previously worried about finding to pay for diapers and other baby stuff emerged from the savings of not eating out!

But eventually, we started eating in more and more. The shift was partly due to the stress of dealing with our two young children after long days at work, and partly just laziness. While we were definitely not spending as much dining in on subs and sandwiches, carry out BBQ, or “Take and Bake” pizzas from Costco, we were spending more than we needed on convenience food.

Since cutting out the carry out restaurant and convenience foods, I have made some great realizations and changes. Meals do take more time to prepare (but I’m unemployed so I don’t care!), and I have discovered a few other nice side effects.

My Meals are Healthier

When I make a pot of chili, I drain all the fat off the ground beef before adding it to the mix. When I cook a pizza, I opt for lower fat cheese or turkey pepperoni. When I make my own sandwiches, I go light on the mayo and eat whole grain wheat bread that my local sub-shop doesn’t offer. When I cook for myself, I can also throw in more veggies, more chicken, and less crap.

Think of all the calories I’m saving. I am also burning quite a few calories in the process of preparing the meal while simultaneously keeping my three year old from killing the baby too.

My Meals lead to More Meals

Some people are picky about left-overs, but I think they are awesome. I’ve found a new love for meals that I can eat for days, especially meals cooked in slow cookers. When you buy prepared convenience food, you’re typically buying one meal at a time, which is one of the less obvious reasons why it is so expensive.

I also learned a neat trick of using leftovers in stews and soups later. A plate of delicious leftover turkey/hamburgers makes a great base for soup later on and leftover chicken breast makes awesome chicken salad for the next evening.

Meal Preparing Time is Family Time

Cooking with my three year old is not exactly akin to taking the path of least resistance, but it really does provide a rewarding and fun experience for both my daughter and me. Since I have started cooking with her, I have quickly become the good parent in the house and eating our creations is always a ton of fun.

With any luck, by the time my little girl is eight, I’ll have her trained up well enough so that she can handle cooking all the meals while I take it easy and watch my afternoon reruns of Seinfeld.

Cooking Can Easily Double as a Hobby or Passion

I would never consider eating out a hobby or passion, but cooking has quickly become both for me. Once you take the dive into the culinary arts, you realize just how much technique, art, and science is involved. My new favorite chef is Alton Brown. I love his mix of science with Good Eats!

And while most hobbies cost you money and give you little to walk away with after the fact, you actually benefit greatly from this hobby. Plus, you have to eat anyway, might as well make it delicious and fun.

Being a Good Cook Makes for a Sexy Guy

Since really learning to cook and fine tuning my skills, I have noticed every woman who dines on one of my delicious creations instantly wants my body. It is no joke. Men who are genuinely good cooks are sexy. My sister in law swoons over me, my wife’s friend’s giggle with joy as they subconsciously touch my arm lightly every time they taste one of my delectable sauces, and my relationship with my wife has been completely reinvigorated since I started becoming a ninja in the kitchen.

Being a good cook is sexy, and women love it- so learn to cook.

Conclusion

Why not make the effort become a master chef in your own right? You’ll be eating better, endlessly learning, building stronger relationships with your family or maybe even helping out your sex life in the process. You will also be saving tons of cash not eating out! So get in that kitchen and get to work.

Have any tips or comments of your own? Let’s hear them in the comments!

——————–
Shane writes for www.WeWearKhakis.com – a site about life at work, personal finance, self improvement projects, and how to have a fulfilling life on a budget.  Check out his site and learn how you can be an awesome guy or gal in Khakis too!

When I was growing up (haha!), my mom would constantly tell me “money burns a hole in your pocket! You’ll never be able to save for anything”, and she was right. After a birthday party or Christmas or graduation, I just had to go spend that money on ANYTHING! If I could get my money back on all that crap I bought, I’d be, well, not rich but at least have a nice savings. The thing is I can’t remember a single thing I bought which shows that it was all for instant gratification and fleeting emotions. Actually, I think a few of my purchases were probably books, and books are good, so they weren’t all bad, but that’s besides the point.

Back to the topic: Emergency Funds. Why are they important? Well I have two real-life examples for you. Luckily neither affected me directly, but both are close to me.

The Curse of the Bad Plumbing

I won’t try to pretend I know this whole story, but what it boils down to is a friend of mine in my hometown was required to redo sewer lines that led into the house (thus, their property) from the street because it was causing leaking and other junk. On my friend’s part, they’ve had flooding in the basement for decades and, personally, I think this was a good thing that finally forced them to do something about the moldy carpeting and old furniture in the basement, but at a high cost.

After getting a number of quotes, they went with a reputable company who had a better plan that meant less destruction (i.e. didn’t require tearing up the entire driveway, just part of the basement floor).

The cost: $8000

Problem is this isn’t my friend’s house. It’s her mom’s house and they’ve been co-habitating families for years. The mom has absolutely no savings, is on fixed income and is actually way over her head in debt, while my friend had been working for years to build up a savings account of, well, just about $8000 which is an amazing amount for my friend (whose husband’s pockets also burn when cash is in them).

Their options were either

1. The mom get into even more debt (if the bank even allowed it) or
2. The friend use her savings for the work and hope she’ll get paid back somehow

They opted for option #2 because there was no way the bank would, or should, give more debt to the mom in her current financial situation, age and physical condition (she simply can’t work). This means that my friend’s emergency fund came in handy at a much-needed time, as she also couldn’t get a loan for various reasons.

Let’s just hope she can get her money back!

The Bad Furnace

This is a much more common occurrence. You own a home and your furnace dies. But do you know how expensive a new heating system is? Well, for one friend, it’s $9000!

I’ve known this friend for 10 years, and he’s actually almost 10 years older than me. He has 2 kids, bought his house at a good time before the peak of the market, but he has a couple issues:

1. A mortgage AND a maxed-out home equity line of credit (HELOC) used to finance improvements and whatever.
2. A good bit of credit card debt
3. A brand new luxury SUV loan
4. A nearly paid-off luxury sedan loan
5. Only part-time income from his wife
6. A love for gadgets and electronics, and generally just browsing the internet for deals (usually during work hours)

I think he’s at a point in his life where I was when I was 9; money just burns a hole in his pocket.

His biggest problem though? He only has cash savings of $2000. Seriously, you’re in your 40s and all you have in cash is less than your net bi-weekly paycheck? Come on man! And this guy makes 6-figures PLUS his wife’s income!

So he was telling me this week that he could he doesn’t know where to get the extra money, especially since the old furnace is dead and winter is coming on soon. He thought of the following options:

1. Pulling from his retirement accounts (e.g. 401k)
2. Going with a contractor who offers a payment plan
3. Getting more, if possible, out of his HELOC

No matter what, all three of the options are going to cost him much more than $9000 in interest, and he’s the type who only pays the minimum on his debts (yet he insists on 10% tithing even when the same Good Book looks down very strongly on those who do not repay their debts in a timely manner and to not needlessly accrue more, but I’m not one to judge…much).

Where do we stand in comparison?

It’s taken a ton of self-restraint, some heavy frugal living and debt paydown, but we’re finally at a point with no debt except our first mortgage (no 2nd mortgage, HELOC, student loans, credit card debt, personal loans, etc.). We no longer live paycheck-to-paycheck and I’ve actually found it a problem to try to figure out what to do with our extra cash each month (savings, investments, paying down mortgage, charity, etc.). We’re not rolling in dough by any means, but we’re not the struggling newlyweds of 8 years ago!

I won’t say how much total we have in cash savings (different than money in investment accounts), but it’s close enough to mid-five figures that I’m pretty confident that we can handle many emergencies as needed, outside of some major health issue or accident, but that’s what insurance is for up front.

But I actually have our savings separated out into multiple accounts: emergency (like a dead furnace or major auto failure), home (such as improvements), travel (which we’re using for a European trip), and auto (either for an eventual replacement to one of our cars or a “fun car” for me). But combine all of these accounts and the sum is amazing compared to where I was at age 9, 19 or 29. I’m 33 now (if I did my math right) and could definitely be much further along with our financial planning, but we’re doing well for ourselves.

But then again, we don’t have kids or pets or any other dependents. And as long as I can hold in my urge to buy a car, we don’t have any other financial fetishes to fulfill.

And that, my friends, is why you need an emergency fund. It’s not just for when you need it, but also for the peace of mind it gives you.

We live in an older community, where our home is 70 years old and those south are mostly 50-60 years old. Back in those days, they didn’t have the concept of McMansions, and most of the home are about 1000-1500 square feet.

So, I generally classify our community (including the largest collection of homes, not just the few streets around us) as either “starter homes”, “downsize homes” or “rental homes”. But on one of our walks recently, we passed a home we’ve passed many times, but something new struck me. You see, this home is average size for the neighborhood, has a garage, but also has a very large driveway. In that driveway is parked one of those “bus motorhomes” (i.e. they’re the same size as a bus). Plus it has a trailer hitched in the back. Kudos to the owner for being able to park the thing, but my focus here is on the following:

Why would someone own a mobile home as big as their house?

But then another thought came to mind (no, not talking about the jealousy one): For all these people with small homes, why not buy a motor home or trailer for the extra room?

I’m no expert on the hookups needed for electricity or water, or even zoning laws for your city, etc., so I’m mostly ignoring those technicalities here, but think about it. Instead of spending $40-100k or more on an addition just so you can get another bed for someone to sleep in once a year, buy a small camper. On the hot or cold days, it’s prepared in some way, whether running from its engine, a generator or hooked into your outdoor outlet to heat or cool the interior. Your guests would basically have their own living space and wouldn’t need to “invade” your home!

And in the economy of the past few years, mobile homes (trailers and campers, not the single-wide type) have taken a pounding and dealers are begging buyers to take them off their hands. Even better, you can get a used one for even less. I have a truck and would just need a hitch and not only would I have that special addition already furnished that we’ve been wanting, but also our own vacation lodging when we want it!

I know I can’t be the first person to think of this. Let me know if you’ve done something similar (e.g. put up your in-laws in your camper for the week), or have an informed opinion on the matter. Remember, rules and laws change by neighborhood and municipality so what goes in rural Arkansas might not be allowed in downtown D.C.

_{Photo courtesy of Philandthehounds}

If you’re stuck deep in debt or you’re barely scraping by paycheck-to-paycheck, this may sound ridiculous, but hear me out.

In our marriage, I make more than double my wife’s income, enough to pay all of our bills and then some back when we were trying to get out of debt (remember, we paid off $200,000 in debt in about 6 years). While all our money goes into one account and we don’t assign each other responsibilities to pay specific bills, we did keep in mind who could and who couldn’t lose/quit their job if needed.

Discipline and Train Yourself

Our secret to paying down so much debt so quickly, other than starting a financial blog with a decent side-income (not planned when I started this site), was to pretend like we were only living on one salary. First, in case we had to live just on my wife’s salary, we built up our emergency fund. Then, assuming it was my salary we would live off, we made sure not to “grow our spending” to match our income increases. It would have been very easy to justify moving into a nicer house, buying a new car or going on a nice vacation, but we had a goal.

We had to discipline and train ourselves (me mostly) to spend within a budget and not splurge on needless luxuries. It sucked because we wanted the nice things in life, but we had to hunker down and stick to the task of getting out from under our pile of debt. It’s not always easy to have both partners working together on the same goal, but we were able to do it.

The Illusion of Rewarding Yourself

There are so many theories, methods and tricks proposed out there (and on this site too) on how to maintain a frugal lifestyle while still enjoying life, but for us what worked was not blowing our money because we “felt we needed a reward”. One of the reasons I got us into so much debt (much of it back in college) was because I felt I had the right to reward myself for various things I did or went through. For instance, maybe I worked really hard that week, so I would burn through a bunch of money on a night out with friends. Or maybe when I was studying for midterms or finals, I would treat myself out to lunch and/or dinner all week (it adds up!), or a new video game for after exams. Heck, I even rewarded myself for a tough semester of interviews for a post-college job with a brand new $20,000 car! And then I rewarded starting a new job with a brand new car…TWICE! In fact, I’m considering rewarding myself for finishing this article with a bottle of soda out of the vending machine

Back then I was definitely living well beyond my paycheck, or even 5 paychecks, so it was really tough to reign in my spending and focus on a singular goal. I had to stop this mental game of rewarding myself immediately and look to the long-term goals instead.

What about if you’re neck-deep in debt or expenses?

So getting back to the single-income/dual-income idea, what do you do if you’re barely getting by with your existing paychecks? Well, the idea still applies here to TRY to live like you only have one income, knowing that you’re in a slowly sinking boat. This idea is actually more beneficial to you than to someone like us with high income or low debt. Regardless of who “brings home the most bacon” (or tofu if you’re vegetarian), pick a paycheck and see how closely you can start spending within it. Start bailing the water out of your boat and try to get to dry land.

Start on paper just to see what your expenses are each month. Go through your checkbook, bank statements, and credit card statements to identify recurring bills and to identify categories such as groceries, dining out, entertainment, recreation and other categories outside of utilities and debt repayments. Try to go back at least 3 months so you can put together some spending trends. You’ll start to see where you can cut some fat out of your spending. See how close you can get down to spending just one paycheck as you can, and then earmark the other paycheck towards building up your savings and paying down debt (as well as charitable contributions and investing).

It’s a very worthwhile exercise to have in front of both of you, but you’ll have to both be honest in your spending, especially if you maintain separate bank accounts and credit cards. If someone is hiding some major spending problems or existing debt, this could be a nearly impossible task, so be sure to be up-front and honest, and be willing to accept criticism of your spending rather than attacking your partners in retaliation. I don’t want to hear “If I can’t spend on THIS, then you aren’t allowed spending on THAT!” because what matters in the end is bringing down spending, period. If one side isn’t willing to stop spending on what you consider a “luxury”, then you need some additional counseling because something is probably brewing and could cause major relationship problems eventually.

The True Reward

In the end, if you live like you only have one paycheck between the two of you, the true reward will be less risk in your lives in case someone really does lose their job, or needs to quit to take care of a child or aging family member. Sit back, close your eyes and picture your life with the feeling of security of knowing you could handle such an event. It isn’t tough at first, or maybe even for a few years like in our situation, but it works. Use the power of two paychecks to your advantage rather than living week-to-week. Get your spending under control so it doesn’t control you.

Believe me, not having the burden of overwhelming debt or risk of job loss is amazing!

Hey there Mike,  I have been following your blog for a few months now. I was just reading the “Our remaining Debt” and saw that you paid it off in 3 years.  I have about $18,000 in credit cards.  What do you suggest to pay these off as quickly as possible?

Just a quick update before I get into answering the question. If you haven’t been following the site, we started with well over $100,000 in consumer debt (not counting mortgage), and paid it off in about 4 years. Sure, there were minimum payments for about 5 years prior to that, but they barely made a dent in the principal debt owed. In that time, we also acquired new debt in the form of a couple cars, but paid those off either with the money earned from selling existing cars or from savings, which was an amazing feeling to even having a “car fund” in the first place!

Oh, and I’ll have another announcement about our debt situation coming up soon, so keep an eye out for it.

Now, for John’s question. Without details on interest rates, how many cards the debt is spread across, your income, etc., I can only comment on how WE went about getting rid of our $20,000 in CC debt (really it was up to $25 a few times).

1. Back in the day, like from 2001-2005, I was able to move our large balances around to 0% offer cards. Now, you can maybe still find the offers, but there’s no cap on the fee. Calculate the cost-benefit of paying the fee vs the interest on the card to see if it’s worthwhile to move the balance to a better interest rate. Also, keep in mind the duration (12 month offers are obviously much better than 6 month deals).
2. Once I finally committed to focusing on paying off the cards, I opted to pay off the couple of cards with the lowest balance. Now, the wisest thing to do is to pay off the highest interest cards first, however, getting those few little wins really helped our motivation to tackle the big balances. But, if your smaller balances are still daunting, and/or the interest rate is extremely lower than the other cards, then start paying off the bigger balances first.
3. Ok, now assuming you have been able to STOP SPENDING (hard to pay down debt when you keep accruing it), and that you have at least a few dollars in your budget to pay extra, then start sending the extra to just one card. Don’t try to tackle all your debt at once or you’ll feel like you’re spreading yourself too thin and you’ll probably give up.
4. Lastly, try to get extra income. I was able to pay off most of our debt over 4 years thanks mostly to the advertising revenue on this site (which most of you probably don’t even notice). It also helped that I had a good job in IT, but remember that I live in DC with a sizable mortgage, car loans, and student loans. I did one loan at a time, sometimes not the correct one, but we got it all paid off and we’re just working on our 2 mortgages now (more on that soon).

John, feel free to comment with additional information or other questions to help me refine my answer more. And same goes with all you other readers. Share your tips if they differ from mine. Is it more than just focusing on one debt, stop overspending and try to get extra income? How else did you motivate yourself successfully?

I’m personally motivated by goals. If I know there’s an end in sight, I can accomplish the goal. Otherwise, I procrastinate and never do anything. Others are motivated in other ways, so share your thoughts!

But we also like travel bargains and USA Today published an article “10 great places for travel bargains in 2011” that really stuck out at me when just scanning through it because some of the countries mentioned. The author suggests, and I think correctly, that countries that are in the news for being “in trouble” for either safety or more often financial problems are often the best places to visit, as long as you take heed of travel advisories and warnings.

A few of the countries that struck me as intriguing are Ireland, Vietnam, Greece and Ethiopia.

For example, I’ve visited Ireland twice (once with a friend and once for our honeymoon) back when the “Celtic Tiger” was just beginning to roar. In 2002, our Dollar was better than the Euro, but in 2003 the tides turned and it cost us 20 cents extra on the dollar. Now that the Tiger is whimpering in its litter box, B&B’s and hotels and every other tourist trap are pushing discounts and promotions that were unthinkable just a year or two ago. I highly recommend visiting Ireland, especially if you’re a travel newbie because it’s so similar to the U.S., except for the currency and the driving on the other side of the road thing.

As for Vietnam, I recently highlighted an article from a friend called “Wanna be a millionaire? Move to Vietnam” in which I highlight the major price differences between the U.S. and Vietnam for things like food, transportation, hostels and cellphone service. And if the food from the D.C. Vietnamese restaurants is any hint of how delicious the food is in Vietnam, then I’m all in!

Can anyone really question why we want to visit Greece? Granted, my college roommate was first-generation Greek and spent high school in Greece so he had very fond memories to share with me which helped bring alive the idea of visiting the Mediterranean (Italy included). Along with Ireland, Greece is in a financial crisis after a boom and has extra hotel capacity for tourists and is hurting for visitors.

And lastly, Ethiopia. It has ancient ruins, amazing food (seriously, trust me) and such happy people, given their general living conditions. Plus, the dollar can go a loooooonnngggg way there versus most other countries. The advisory is to join tours rather than going out on your own, which I would do anyway in such a foreign country (to us). Being in D.C., we’ve been exposed to Ethiopian culture and food by visiting over a dozen different restaurants (including in Pittsburgh and San Francisco) in the last few years. It’s my dream one day to visit Ethiopia, so perhaps we can get there briefly if we visit our Kenya friends.

What’s your travel bargain tip? Any country that others wouldn’t normally visit that you have found to be safe, affordable, fun and educational?

I work in a cube farm and we each have 2-3 fluorescent desk lights under our shelving. Most of us don’t use the extra lighting, but a few others like the extra light, especially if they do quite a bit of paper work (instead of computer work).

However, I have a certain coworker near my cube who insists on leaving her desk lights on and gets mad if anyone turns them off overnight or over a long holiday. She tries to justify it by saying “my plants need the light”, but I’m sorry to say, the plants aren’t getting very much from this extra light compared to the amount of energy they’re using by being on so long, plus the damage to the environment when it’s time to trash the old bulbs when they die.

What else does this coworker do? She doesn’t give a crap about recycling. There’s a mixed recycling bin about 10 steps from her cube that accepts paper, plastic, and cans, but she tosses everything into her own can, which, of course, goes straight to the dump, not to the recycler.

Confrontation

So every so often, I turn off her lights, especially on Fridays and holidays, but I always hear her complain when she gets in, like it’s some horrendous event for her to turn on 3 switches. I hear her complaining about “someone keeps turning my lights off! Who would do such a thing???”.

So this past Monday, I turned off her lights when she left, then on Tuesday she came in and complained as usual. I had my boss in my cube, so I called over that I turned them off because the university has a guideline to turn their lights off. She replied back, not knowing that our director was there, that “Bob (name changed) said she could keep them on for her plants”. My boss replied back that 1) Bob doesn’t work here anymore, 2) Bob didn’t pay the electric bills and 3) it’s university policy to turn off your desk lights when you leave.

She didn’t reply back.

And just then, we all got an email from the university listserv reminding us to conserve energy by a number of ways, number one of which was to turn off your desk lights. SCORE!

Will she change?

No, she won’t change. Why? In my opinion, she’s selfish and inconsiderate of others. There’s many other incidents that lead me to this conclusion that won’t fit in this post and probably shouldn’t be written anyway, but this coworker is just the type that cares only about herself. She thinks people are out to get her, that people are constantly stealing things from her desk…wait, is this Office Space?

What’s my point?

So what am I getting at? First, I wanted to complain anonymously about this coworker just to get it off my chest, but after a conversation with my wife tonight, we wonder if we’re in the vast minority. The minority being people who aren’t “Green Peacers”, but care about the environment. While we waste in some parts of our lives, we also go a little out of our ways to recycle or generally avoid waste in others.

For instance, my wife goes through her office floor, turning off lights before she leaves. She also combines her trash can with the bigger, more used can so the cleaning people don’t waste a bag. She used a reusable mug rather than the paper cups in the kitchen. She uses water she doesn’t finish to water the office plants instead of just dumping it out (as do I).

I didn’t grow up with a conscience about protecting the environment; rather, I think it’s the efficiency aspect I enjoy. I like to see ways I can save money or materials while still getting the job done, and that’s a trait I’ve adopted over the years.

An example of my non-frugal youth is when I was in my early teens, our town instituted the blue can recycling (where you had to separate everything, bag up paper, etc.). Back then, we hated changing our patterns and getting another can in the kitchen for recyclables, then going through “garbage” to separate them in the blue can.  I think my family still doesn’t really practice recycling much, but they don’t have the luxury of single-stream recycling (where you don’t need to separate stuff). Let’s see if this article sparks them to change

Another thing we do is compost food.  We have a Soilsaver Compost Bin from Sam’s Club for about $40 (I’d link to Amazon, but they cost double) out in the yard. The hard part for most people, though, is what to do in the kitchen with the food waste. We have an old Country Crock container as a holding place for the food and we keep it in the fridge. When it’s full, we walk it out to the bin and dump it and start over. Not that hard, now is it? And this year, we got a wheelbarrow-full of nice black soil out of the bin from a year of composting yard and kitchen waste, which we used for our tomato plants (our first garden actually).

Are you selfish?

What do you do in the office, or at home or at school? Do you just dump your bottle or paper in the trash, or do you search out a recycling bin? Do you take your recyclables home if your workplace doesn’t recycle or is that too bothersome? Do you recycle and conserve out of concern for the planet’s future, or out of efficiency?

How an ice cube can multiply your fry order

Phil goes into how he gets fries from a fast food joint, along with a drink. He then eats a few fries, then throws an ice cube from his drink into his fries. It makes the fries soggy, then he goes and complains about the fries to get new ones. He then eats the soggy fries AND the free, unearned fries.

Having worked in fast food for a few years in high school and college, I wonder now if anyone pulled this trick on me. If I found out, I think there would be some “extras” included in the new fries…but then I guess that would earn me a punch in the face.

How to “win” at potlucks all the time

Basically, this tip involves such tactics as avoiding the signup list for office potlucks, or signing up for something someone else already signed up for…and then not bringing it. He’ll even buy something he knows no one will eat and then return it to the market the next day. This is a fast track to a PUNCH IN THE FACE from yours truly!

The art of the well-timed breakup

Ok, seriously, breaking up with or having a big fight with your partner right before a major holiday or their birthday just to save on a gift? Would you date this guy or girl? Ok, so I just happened to have a fight with a girlfriend about 15 years ago right before V-day, but that was unintentional, and I got her a gift when we reconciled anyway. But to purposely screw over your relationship for a couple bucks for flowers? That deserves A PUNCH IN THE NUTS!

However, I will admit that Phil has some great, HONEST, frugal ways to save money and NOT screw others over (for the most part). For instance,

Watching women’s sports

No, this isn’t sexist, it’s frugal. Phil has a point that women’s sports cost a mere fraction to attend compared to the men’s counterparts. Granted, there’s no pro women’s football, but when it comes to women’s basketball or soccer, you can have a very cheap date, watch a good competition and earn brownie points with your lady (unless she’s a huge sports nut that only wants to see the guys). My recommendation…women’s indoor volleyball. Phil agrees too, but you’ll need to read the book to find out why

Dorm kids’ trash is your treasure

At the end of the college semester, drive around the dorms and find loads of barely used furniture, books and what have you for free, all near the dumpster. I say “near the dumpster” because you need to make sure someone just didn’t leave stuff by the curb while they get their car.

Here’s a funny story. Back when I first moved to the DC area and my wife and I were renting an apartment, I was walking down our hallway when I noticed our neighbor had a nice pair of strappy heel shoes next to a tied up bag of garbage. I figured that both were destined for the garbage chute, so I snagged the shoes…which were just my wife’s size. Little did I realize that our building was full of Asians whose custom is to remove their shoes outside of the apartment. I didn’t realize this until years later, and by then I would have no idea who that neighbor even was.

We still have the shoes, and they look great in her summery dresses

Same story goes for this same building when I found a perfectly good Dirt Devil vacuum next to the garbage chute on our floor. Turns out the cleaning lady probably just left it there while she worked on another floor! Gulp!

Ok, I’m a bit cheap myself, so I’ll give props where they’re due, but some of the “Stingy Scoundrel” ideas are just plain illegal. Things like taking ketchup packets to fill your ketchup container at home sounds exactly like stealing, no matter how you rationalize it. And I would think swapping your scratched up DVDs for new ones from Netflix goes against their terms of service, and again it’s stealing. (although Netflix does decontent their DVDs so you’re getting less features on your “new” disc).

So Phil, I’ll give you a big, manly hug for all your good ideas at saving some moolah, but I’ll warn you, if I ever meet you in person, I’m punching you right in the face. Then you can find a way to steal from a hospital when you have a broken nose and jaw.

(Oh, and yes, I really did enjoy the entire book for both its entertainment and educational value, regardless of how wrong some of the ideas were).

I earn good money, more than most of my friends (and family!) but as a consultant I work hard for it – I get inside my clients’ businesses, I help them with whatever they may need, I offer my advice, my contacts, my services and of course my time. I work late and on weekends and as a result my partner and I recently decided to reward alour hard work with a new car.

The Dream

I have always wanted an Alfa Romeo (probably because of my Italian background – who knows) and so my partner and I headed to the prestige car dealership. It was a gloomy Saturday afternoon and as a result we were the only customers, and were able to head out straight away on a test drive of the new 147, in red of course.

The Alfa was fast, it was smooth it was beautiful and because Alfa Romeo are not going to make the 147 anymore, we would have been able to lease a brand new one for just over $500 a month – perfecto! Or so we thought. When my partner and I looked at our situation – our earnings, minus our mortgage repayments, phone bills, power and water, $500 a month seemed like a drop in the ocean.

However, we soon realized we were in the situation that many of you are probably familiar with, of spending everything we earned and not being left with $5 at the end of the week, let alone $500 at the end of the month – when was the last time you saw $500 left in your bank account at the end of the month? How could this be – after our bills and mortgage repayments, a couple of transfers to our savings account (to pay for a trip to the home of the Alpha!) there was nowhere near enough left to cover repayments for a new car, month after month.

So with the end of the financial year approaching and the tax benefits (and the perks of a new set of European wheels in the driveway of our new home) slipping away we resolved to make our Alpha dream a reality. You see it is easy to spend everything you earn because you think you can – all the money in your account is there to be used, so your natural inclination is to spend without thinking until it runs out.

The Plan

That is where we realized our first hurdle. While we knew how much we earned, we knew what our bills were and how much our mortgage repayment would be, we didn’t know where our money was actually going because we had a static budget. You can’t expect to budget successfully by looking at your budget at the beginning of each month, or once every few months to see how much your bills are.

Instead you need to list all of your expenses for a month, as well as keep track of all of the incidentals. This means noting when you have a coffee on the way to work, when you go out to dinner with friends and including the cost of the meal as well as the cost of the fuel and the car parking. But you have to start with what you kngeow, so we went home and got out our list of bills where we had budgeted for $150 worth of groceries each week, a combined mobile bill of $100 (excellent capped plans!), our home phone and internet bill of $200, the $100 a week we were already contributing to a savings account and so on.

We then each took a notepad with us to record our incidental spending, but you can just collect the receipts as you go as well. Every couple of days we entered our spending into our new budget spreadsheet and before long we saw the spending add up. I had budgeted for $40 a month for a dinner with the girls (and a shared bottle of wine) but I was forgetting the $10 we spent on the traditional after-dinner coffee and ice cream. I also noticed I made sure to note the times of client meetings so I could raise an invoice, but I never noticed the $15 a week I’d spend at the drive through on the way home from the meeting when I was starving from a day on the road.

When my partner started adding up his morning coffee run he found he’d spend $5 every morning – plus the $5 coffee in the afternoon on a particularly long day. Then there was the run to the deli at lunch time for a $10 sandwich which quickly became $20 with the addition of a drink and a chocolate bar for the road.

We also found ourselves going consistently over budget at the supermarket too, spending an average of $200 a week, which added to the budget issue because we were spending so much on dinners out, deli lunches and junk food. So we decided to shop smarter, make our lunches, invest in travel mugs and buy healthy snacks at the supermarket which could see us through hunger cravings. I also decided I didn’t need the extra sugar after dinner, and I’d probably sleep better without a late night coffee with the girls.

The Savings

We saved:

• $10 a month on an after dinner treat.
• $15 a week on the drive through = $60 a month.
• $10 a day on coffees = $200 a month.
• $20 a day on lunches = $400 a month.
• $50 a week on groceries = $200 a month.

So that was a saving of $870 a month we could make simply by being a little more organised with our meals. I still got to enjoy dinner with the girls and my partner still had his morning coffee – he just made it at home before he left for work.

As the bills started coming in we saw where the next big portion of our wages was going. Our mobile phones were on capped contracts which should have cost us $100 a month combined. However, when we looked at why we were actually paying $200 a month we saw that my partner consistently went over his capped hours and into the talk time which was charged at a higher rate, my mobile was skyrocketing because I was addicted to the connectivity of my smart phone. So my partner starter monitoring his mobile spend and when he approached his capped limit, he would use my phone as I hardly ever used up all of my capped time. I also cut back on my Facebook mobile use and logged in only when I was in front of the computer.

Unfortunately our home phone package was more than it should have been and we found we were paying around $250 a month. When we looked at that bill the extra charges were made up of mobile calls we’d made from the landline and so we resolved to use our mobiles (on which calls to other mobiles were included).

So we saved another $150 a month, bringing our savings up to more than $1,000 – more than enough for a new car, plus fuel, registration and a little more for the holiday fund. However, as we continued to track our spending we saw our grocery bills stay steady at around $200 a week. While we went shopping with a list and didn’t buy things we didn’t need, we were spending more on snacks and lunch ingredients. However, the $200 more we spent on groceries was still less than the $600 we had been spending on getting lunch at work, so our monthly savings were still a healthy $820 a month.

As you probably also know, it can be hard to resist a shopping splurge and I saw myself entering $50 for a new scarf one week, $200 for a new pair of patent leather shoes, another $50 for a cute top and $500 for a gorgeous red laptop bag. If it’s not scarves and shoes and bags it’s going to be something else but this budgeting trial was all about saving without really having to try, so there is no need to cut out all retail therapy, just plan a little first. If I’d looked, I would have seen we already have three unused laptop bags in our office, and while they’re not red, they are going to do the job, in the same way the new top does the job of the three other tops I already had in the same color. However, if you know what’s in your wardrobe, you can more clearly see the gaps and make fewer purchases, but ones which are just as satisfying.

Learning to ‘shop your wardrobe’ gives you a chance to rediscover items you had forgotten you had, or which you now fit into again, and pin point the items which actually need to be replaced. So you can still budget for $100 or $200 a month for clothes and save $500 a month by buying only things you really need.

For those of you keeping score, yes we’re now up to a saving of $1,200 a month and I don’t miss the ice cream or the monthly influx of new shoes because I now have a gorgeous red accessory in my driveway permanently, as well as a more structured and realistic savings plan, not to mention a healthier diet.

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Vanessa is a personal finance writer at Home Loan Finder, where she offers tips and advice on how to choose the best first home buyer home loans

When it comes to personal finance, we are all looking for ways to save more money. Our household budgets are filled with both big and small expenses that we imagine can be cut out to save us loads of cash or at the very least, spent better elsewhere. One of the things you have surely considered is using public transportation rather than your own vehicle.

Are the Bus and Train Cheaper?

It would be easy to assume that public transportation is cheaper, because a bus token is far less expensive than gas, but those are not the only costs to consider. Take a step back to your high school economics class and try to remember the lesson about opportunity costs. These, as you might recall if you were awake for that class, are the things you give up when you choose one option over another option. Although they are not measured in dollars and cents, they still have to be considered whenever you make a financial decision.

There are a lot of opportunity costs when you take public transportation instead of using your own vehicle. For me, the biggest cost is comfort. Let’s be honest, public transportation is frugal, but just not that pleasant. Buses and trains do not look a bit like the ones on television do they? I used to live in Chicago and every time I see a train station or subway on ER or any other Chi-town based show I think, they must have shot that in the nicest train in city, or it does not exist in reality at all. Most trains and buses are not very clean and not always filled with people with whom you want to share a ride. Taking public transportation also takes a lot of extra time. You will have to get to the station, possibly in your car where you will have to pay for parking, then get on one or several trains and buses to get to your actual destination. It can easily turn what would have been a 20 minute commute into an hour long one.

Of course, the time cost is debatable depending on where you live. When I was in graduate school in a small city in Indiana public transportation was free for students which was a dream during those frugal times. But, it was only buses and took 45 minutes to get to campus. To drive it would have only taken 20 minutes but I had to pay a premium for parking. However, since I often had to be on campus in the evenings when the buses were not running, I had to purchase a parking pass anyway, so the bus was not really much savings (gas back then was still pretty cheap). On the other hand, if you live in a big city like Chicago or New York City the drive could take you an hour, even if it is only a short distance. Those drives too could tend to be very unpleasant; lots of sitting in traffic and listening to car horns and colorful language choices from other frustrated drivers.

Red Line, Purple Line, Conga Line!!!

One of the other things that was problematic for me is that I could never figure out the bus or train maps and schedules. I tried hard in school to manage my personal finances and care about the environment, which heavily leans toward public transport. Once, after waiting and waiting on a bus that never arrived (and I was not entirely certain was the right bus anyway),  I decided just to walk all the way home. I do not recommend this. Needless to say it was my last solo attempt at the Indiana buses. If you are lucky, like I was, to know someone willing to help you understand the labyrinth that is the city bus or train schedule, beg them for help.

When it comes to the actual money you would spend on using your car over public transport, the public transport is likely going to be cheaper. Passes for the public transportation are somewhere between $20 and $50 a week, depending on where you live. If you have to park your car at the station you can add on another $50 a week at $10 per day. That means that your personal finance would be impacted at about $100 a week, in the city if you drive your car to the station. It drops to less than $50 if you can catch a bus close to home.

If you drive your car you have a lot of costs to consider. Even if the car is paid off you are still paying insurance at a rate of $100 a month, if you have a relatively cheap policy. That adds $25 a week. You can also figure a tank of gas a week at an average cost of $2.50/gallon for a 10 gallon tank. That adds another $25 per week. Add to that the cost to park in the city. In a place like Chicago your parking space would easily cost you $20/day. Added up, driving your vehicle to work will cost you at least $150 per week.

It is pretty obvious that the frugal choice is to use public transportation if you are looking at numbers only. But, remember to also consider those opportunity costs. Is your time and comfort worth the extra $50 or $100 per week? Are you spending extra money on child care because of the extra time that public transportation adds to your commute? Are you using your car for other things like stopping at the store or going out with friends after work? If you do not own your car the choice is obvious, take the bus or train and save a bundle. But, if you already have a car is it really that cost effective to take public transportation? Maybe, maybe not. It comes down to your personal preference. Only you know how comfortable you will feel using public transit and what you have to sacrifice for the extra time and effort it takes to do so.

This is a guest post by Timothy who is a personal finance writer and part of the team at Credit Card Finder. For more information, simply visit our website or subscribe to our RSS Feed.