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Posts Tagged ‘Frugality’

Crazy Prepper Non-Spending Challenge 2012

I remember reading Robinson Crusoe as a child, and being fascinated by the constant counting of things.  The protagonist (the way I remember it) kept perfect track of his supplies.  Bullets, food, nails, boards, everything.  He realized the rationing of his goods was the key to his survival.  I think many of us probably feel the same way, and it is one reason we are drawn to survival fiction, post-apocalyptic movies and the like.  We live in such a time of abundance, that even our poorest could be ranked as royalty in many places of the world today, let alone among our forefathers.  A little bit in the back of our heads, we wonder if we could survive in such bleak situations with just what we have on hand (or worse still, without anything on hand).  And perhaps we even wish to (not realizing the privation many of our ancestors really faced):  to be able to turn off the iPods, throw out the cell phones, the computers, and just exist with nature without all the noise of a 21st century existence.  While my wife and I won’t be going to any Crusoe-esque extremes, we are going to extremely limit our intake of new goods in the first half of 2012.

So what spurred this?

Late last year I found some Grand Canyon sized holes in our monthly budget.  I noticed toward the end of the year we weren’t able to put as much toward the principal of our home as we had been, and that our savings hadn’t grown at all since autumn.  If anything, it had shrunk.  Part of that was the ginormous COBRA check I wrote in December; I pre-paid it until it expires in September 2012.  I did that mainly because I don’t like worrying about forgetting it month to month and it is such an important item.   Plus, because of my wife’s Fibromyalgia, I have been unable to find other coverage for us, which had been my hope.  (Because it would have provided some tax benefits.  We’ll end up getting an expensive guaranteed-issue policy once our COBRA expires.) Part of it has been additional competition in the marketplace.  While the overall ‘prepping’ marketplace grew in 2011, the number of businesses entering the market far outstripped any new revenue.  (A small warning to anyone who is thinking of entering the market this year.)  And part of it, when looking honestly at our budget, was a large chunk of discretionary spending; things like eating out, going to the movies and the like.  We have always been fairly frugal even in the best of times, but we hadn’t really been controlling our spending well since we have both been working from home.

Coming up next  is tax season, and I really don’t have a good handle on what that will bring.  As a small business owner I’ve been paying quarterly taxes, and I do have some withholding from my previous job.  However, due to having to pay both SS and FICA on top of regular income taxes, I’m worried we’re going to have to write a huge check to the IRS in April and that it could wipe out almost half our savings, putting us right back to where we were when I quit my previous job.  Nearly a year into this, that is the last place I want to be. 

So after some long discussion with my wife, she suggested we try to put our preps to some additional use, and to cut our discretionary spending to $0 for the first six months of 2012.  This will give us a better handle on our overall budget, help us determine what our preps are missing, and force us to re-evaluate our needs in terms of nutrition and entertainment.  For example, we have board games on the shelf we’ve never played, so why are we buying new ones?  We have books we’ve never read, blogs we haven’t written and projects we haven’t completed, and this will give us a chance to get to many things we let slip for too long, while allowing us to spend quality time together.

So the rules of the game are we’re only allowed $20/week for fresh food and random expenses, and a tank of gas every 2 weeks (unless the business necessitates otherwise).   While we still have preps in the basement and anything in the pantry, we’re not to spend anything except for business expenses.  This is made a little more complicated due to the impending demise of our $100 Craigslist dishwasher (it’s lasted 2 years, so I still think it was a deal).  Right now it’s making some horrible racket while it washes, so we’re guessing its only a matter of time before it dies.   Hand-washing dishes certainly won’t kill us, but that is time we won’t have available to do other things. 

More importantly, over the holidays we broke the oven portion of our range (The filament cracked, and we’ve been unable to find another for this make and model.), making cooking a little more challenging.  We still have the use of the top burners.  This might actually be a small blessing in terms of ‘learning to live without’.  We’ll be cooking on our Bubba Keg (probably the best cooking device ever invented), in a small portable camp oven my wife bought at Costco last year (propane), and on our propane grill.  We have 4 tanks of propane and a bag and a half of lump charcoal.  Rationing those two items will probably be the most challenging, and is what made me think of Robinson Crusoe. 

So we’ll keep you periodically updated as to how things are going.  My wife is already doing some crafty stuff while watching TV (she’s making pompom rugs, whatever those are), and I’m working on some business stuff and a little extra blogging.  If any of you have any prepper related goals, drop me  a line, I’d love to hear about them!

09

01 2012

Living From the Pantry, Take 3

I saw this post referenced at The Simple Dollar and it brought back fond memories.  The first time our wife and I went without grocery shopping last year, we went a little over 7 weeks without buying anything.  At that time, we were actually using powdered milk for drinking, so didn’t even need anything as far as perishables were concerned.  We did it again late last year and lasted about a month, though there was a little more cheating involved as my wife was diagnosed with a gluten allergy and requires more fresh foods.

Due to some upcoming concerns about our budget, we have decided to give it another shot.  Our pantry is packed full, we have a freezer that has a hundred pounds of meat and chicken in it, and a cooler stocked with water and Gatorade.  The only thing I usually find myself wanting and running out of is chocolate.  However, I think the wife has some cake mix and I stashed a box of Chips Deluxe last week after a buy-one-get-one event at Publix, so I hope I’ll be ok for sweets.  I mentioned that we had so much, we could probably go more than a month, but she’s drawing the line right now, so we’ll see!

For a more thorough example of one families adventure in non-shopping, see this series of posts!  Wish us luck!

24

02 2011

Financial Preparedness Friday 401(k) edition

Financial Preparedness Friday’s will be articles that combine a ‘What Can I Do Today?’ with a more detailed look at a financial topic or question. 

So today’s ‘What Can I Do Today’ is:  If you are currently working, and are employed at a company that has a 401(k) and you are not signed up, call the Benefits department today and get the paperwork to join.  If your company offers a dollar match in your 401(k) and you are not taking advantage of it, you are not participating in what could by the highest return percentage available to you. 

If you are in your companies 401(k) and you are not getting the maximum match, increase your contribution percentage until you are getting the maximum match.  And if you are already contibuting to get your maximum match, congratulations!  Now take it one step further and raise your percentage by 1%. 

If you say you can’t afford it, my response is that you can’t afford not to do it.  Take a look at the above image.  It shows that Social Security is currently in the red, many years before almost anyone predicted.  That means that Social Security, today, is now spending more money than it takes in.  If you are relying on Social Security to assist you in your old age, don’t.  Being prepared means being financially prepared to take care of yourself without depending on anyone. 

I absolutely understand it is challenging to put money away in a very difficult economy, but I implore you to make saving at least a little bit the first thing you spend your money on (the 2nd if you tithe), not the last.  For those working hourly jobs without access to a 401(k), I’ll let you know a little method that literally changed my life, with little effort.  I’ll warn you though, you will need some willpower.

In 1999, my life, financially and otherwise, was a train wreck.  I was unemployed, I smoked 3 packs of cigarettes a day when I could afford it, drank too much beer, and otherwise was on a self-destructive path.  I had $43,000 in credit card debt and another $3,000 in student loan debt. 

When I say I know how bad it can get, I do.  In late 1999 I filed bankruptcy.  While I believe in paying my debts, at that point in my life I just had no idea how that was possible.  I was making $8 an hour, and I couldn’t even afford minimum payments on my debt, let alone extra to pay down principal.  However, it was after the bankruptcy when the most difficult choice appeared.

Within 2 years of my bankruptcy, credit card companies were offering me credit again.  I actually opened 2 credit lines, and very quickly found myself staring at $2500 in credit card debt.  One day I looked at myself in the mirror and couldn’t stand what I saw.  What I saw was a complete and utter lack of control over my own life.  And it was that day I took a stand.  I called and cancelled one card, and hid the other one and swore I would use it in emergencies only.  And while I can hardly believe it now, I stuck with it.  I paid off the credit cards by 2004, paid off my student loan about the same time, and started on my sometimes-rocky financial recovery.

So how did I manage it?  From my first day of work, even when I didn’t know why, I always paid myself first.  When I first got the job for the company I am still working for and was only making $8/hour, I put $10 a week into an envelope.  It was the first thing I did with every paycheck.  It wasn’t a lot of money, and I couldn’t really imagine that I would ever save any real money that way.  But what it did was more psychological than financial.  It gave me peace of mind.  When a water pump blew on my car, I usually somehow had just enough in my evelope to cover it.  When I had to have insurance or risk driving without, the envelope usually helped me with the last $50 or $60.  When I wanted to take a pretty girl out on a date, I thought that was an emergency too and usually raided $40.  Before I knew who Dave Ramsey was, I had created my own emergency fund. 

When I got a raise at work, I increased the amount I put in the envelope from $10 to $20 per week.  If I did an odd job or sold something on eBay (something I did more and more as time went on), I put a portion into the envelope.  There were some weeks when I would have $800 or more in the envelope, and others where it was near empty, but I never skipped a week or made excuses why I couldn’t put some amount of money in it.  Eventually I even used a good chunk of ‘envelope money’ to pay off my credit cards and start a debt-free lifestyle. 

Today I challenge you, no matter what your current financial status, to stretch and take one small extra step.  As I have said, I will be doing anything I ask you to do.  After I post this article, I will be increasing my 401(k) contribution from 5 to 6%.  (my match is 5%)  I hope y’all will do the same.    So whether it is putting $5 in an envelope or saving some of your birthday money instead of spending it, I guarantee there will come a time in your life when you will be glad you did.

14

05 2010