by Tricia
Because things are tight financially right now, we are on a spending freeze. We are only spending money on necessities. We put this to the test last weekend when we returned something to Walmart. Even though we walked through the store, we walked out without buying a single thing.
It felt so weird to do that. We should have a cart full of stuff we are pushing out the door. I felt like an oddball walking out of the store without a bag in my hand. At the same time, though, I felt pretty darn good.
For example, I didn’t decide to buy some clothes for next season on clearance. Normally, that would be a great thing to do. But not right now. We don’t have money so we don’t need to be spending money. That was a big problem that I had in the past. I’d often buy things on sale and make frugal purchases – but I put it on credit! I wonder if there is a word out there to describe that behavior. In my mind I was being a great shopper.
Probably tomorrow I will dig into our Quicken file again since some income has come in. I will have a better idea of where we stand and hopefully we can replenish our savings account some. I do think this spending freeze is helping.
We should do them more often 🙂
It’s called spaving – spending to save 🙂
SOunds like you might want to join in my Fiscal Fast: http://theshoppingsherpa.blogspot.com/2008/06/fiscal-fast-rules.html
It’s like a spending freeze but approached as a game not a necessity 🙂
It’s great that you found a way to “take control” again with your spending freeze. From the tone of your post, it sounds like it’s helped your mood as well as the bottom line.
I think you’ll come through June feeling more adept at handling any future bumps that come your way.
And get a little sunshine on your skin, that always improves my mood.
Just last night my husband informs me we have the kids this week because the ex who was suppose to take them can’t afford daycare. So we’ll be on a really tight budget this week. Last week I made the mistake of planning for groceries for just the husband and I since the ex said she was taking the kids. The money we usually have for food is gone for daycare for her (yeah, then why can’t she afford daycare again??). Plus, the credit card we do use for emergencies I trusted once again and found out that wasn’t a good idea. It’s the only card I have open and use when we have to. Well the amount they stated was on the card was not including the interest rate that they pull a month in advance each month, I learned, so we’re about $20 over the max plus an over the limit fee. Sigh. This will be a fun and exciting week!!!! 😀
A spending freeze is a great idea! It makes a lot of sense for when one is in a financial pinch, like you are, but I also think it would be useful for anyone to do periodically. A spending freeze would highlight how much spending we all do, needs versus wants, how much we can pass up purchasing without regret, etc.
Also, regarding your current financial pinch…what about temporarily going nuts to increase income in the household? Just for 1 or 2 months. Your husband could get any sort of temp job, you all could try to find more stuff to sell, etc.
I enjoy it when a day or few can go by and there was no spending done. Sometimes I check the account and still can’t believe the balance hasn’t changed. I’m task oriented and typically only make a trip or do something to accomplish a goal. Our major hang-ups every month are spending on clothing and eating out. Obviously these can’t be completely cut out but it would be nice to reduce them to a reasonable level.
Tricia-
One of my other blogging buddies had a “week without groceries challenge”. The challenge was to not run to the store, buy any other food, etc, for a while week. You just have to subsist on what’s in the house. I took the challenge, and it was awesome! You not only save money, but you teach yourself new recipes, too. For instance, I always make fish with a garlic and olive oil marinade, but without garlic in the house, I used lemon juice instead (with lemon pepper salt and oregano), and my dh and I loved it! I would have never made it like that otherwise. I was baking awesome cookies, making great salads. I really learned a lot and also lost five pounds.
Then, when it came time to go to the store, I only bought things which would help me use things I already had. For instance, milk for the cereal, eggs and butter for the baking, etc, etc.
My grocery total that day was only $40, (this total included steaks for the steak sauce we had) and it all lasted us another week.
It felt like we were feasting, honest.
Huh. I walk out of stores empty handed more often than I walk out with something. The last clothing I bought was a pair of fleece pants (on sale) in January. I really should probably buy some new clothes, especially after the ball-point-in-the-dryer incident which converted a lot of business-casual clothes into garden-casual clothes.
I still do the spending freezes once in a while. It keeps my monthly spending within bounds, and reminds me how often I forget about impulse items if I just wait a while. That’s one of those lessons that needs a booster shot now and then, and seeing something on the shelf at the store and thinking “Man, I was sure I needed one of those a month ago although I can’t imagine why” does the trick.
Good for you taking control 🙂 I try as much as we can to take control and freeze our spending where we can. Most that read this are probably more of the pay now worry never mindset. I have no doubt that someday when this is all over with you will never be where you started again!
I’m on a spending fast, too 🙂 Good for you for not buying anything you didn’t intend to buy! In a month, I’ll be okay to go ahead, but for now, that’s going to be the story of my life 😉
I have to admit, it’s a bit like dieting, good intentions don’t go very far with me. We have made some progress in cutting speding, unlike my eating!!!!
I’m in month 11 of not buying anything new (except for medical/food expenses). Over the 11 months I have broken that promise to myself about 24 times. That does not count the new parts I bought for the cars or the furnace. Replacing used up tires with used tires didn’t seem effective to me.
I found a nice dress for my dd’s wedding at a consignment store. My dh even bought a used (rental) dinner jacket for the wedding and got it tailored to fit him well. He’s starting to ‘buy’ into this concept.
Mainly, I have learned to do without, repurposing things I already own, borrowing/renting or trying to buy used before even thinking about buying new. I gave mainly gifts of services for Christmas (i.e. memberships, video rentals, music downloads) and some used things. I did buy new for some gifts mainly because I felt it was unfair to impose my values on someone else to that degree.
Shopping in any form is no longer comfortable (even at grocery or second hand stores.) I’ve literally got out of the habit.
Major upsides (aside from money)? More time – less time needed reconcile Quicken because of fewer receipts. Plus I save the time I used to spend reading ads. No time is spent shopping. Errands are now limited to grocery store, library, bank. Gas is saved since we are rural and I’m using only the two closest grocery stores because there is no reason for me to drive into the city to shop.
Major downside: weight gain. I was apparently using shopping as therapy and I’m using food to fill that void. Recognized the problem 5 months into the experiment but have not figured out a solution yet.
My main caveat is that I didn’t do this with young children. My kids were 18 and 22 when I started this and old enough to understand my reason (the environment). They are also old enough to make their own spending choices so I wasn’t impacting them much (except for Christmas.)
I recognize that it would be somewhat more difficult to do this with small children (when you are in your acquiring phase of life.) But there are many people on the Compact (the name of the group that inspired me to start this) who are doing it with children.
Living in Connecticut, my wife has never decided not to spend or go on a “spending freeze”, which I wish she would. When you go shopping, and there is money in the bank, you spend until there’s nothing left in the account, right? Having no budget wasn’t always the case with us. 10 years ago, I earned $35K/year and she worked part time for $25K/year. This year, I’ll earn around $170K/year and my wife no longer works. With 100K+ a year increase, we are still not much better off when it comes to kids college or retirement.
My degree is in Economics. Fundamentally, when it comes to finances, you want to spend as much money as you can on things that appreciate (art, antiques, coins), and spend as little money as you can on things that depreciate (cars, clothes, electronics). When you look at very wealthy people, they have more on the appreciating side than the depreciating or expenditure side which equates to net worth. The only time where it makes sense to borrow money is when the rate of appreciation of the asset is equal or greater than the rate you purchase the item. Real estate is an example of this (including the tax write off benefit) Credit cards are the worst because you are typically borrowing money at a very high rate on something that loses value very quickly.
My wife and I come from two very different backgrounds. I came from a hard working but successful family where my parents started with nothing but with due dilegence, are doing extremely well financially. My wife on the other hand came from less and whenever there is money, “it’s time to buy Kraft Mac and Cheese instead of the store brand”. My feeling is that I’ll keep buying the store brand, and turn that 25 cents into 50 and that 50 into a dollar before buying Kraft.
I’ve been trying to explain the difference between good expenditure and a bad expenditure without much luck. She’s horrible at math. Teach your kids math and accounting!!!
Dan, you could have foreseen this before marriage and children. It’s very hard to make a relationship outside your social background work. The fact that it is politically incorrect to say so doesn’t make ik more true. I hope you don’t end up with another liability called alimony.
Edit: Doesn’t make ik LESS true, of course.
Couldn’t have forseen it. If I gave you the background, it would sound like a Jerry Springer show. We both came from identical socio-economic backrounds but with a different perspective on finance (parenting has a lot to do with this). And for the alimony, at least I could budget around it! (just kidding)
My dad joined the Air Force at 18 and after 20 years, retired (to join the private sector) with a Bachelors Degree and MBA. And trust me, we ate a lot of pasta and hamburger helper. A lot of times, we did without. We never borrowed money. The only time my parents borrowed money was for a mortgage on their second house. (paid cash for the first one) No credit cards. Paid cash for all purchases including cars.
Again, borrowing money to purchase depreciating assets is one of the worst things you can do financially. Especially high rate consumer credit cards.
This blog is great and I commend the folks who are staying focused and sticking to their principles. The US economy is one of the most consumer driven economies in the world. Much more so than other countries. Corporate marketing teams want you to think that you need a certain pair of shoes. Your sheets need to be extra white. Your old car uses too much gas and you need a new “green hybrid”. Whatever it is, you need to buy.
All of my customers are Fortune 500 companies. The CEO’s primary goal is to drive profits in order to increase shareholder value, and nothing else. Whatever it is, they depend on you to consume. Even if it means going into debt. Our consumption driven economy does not have your best intrests in mind. Don’t give in, stick to your guns and feel good about it.
Dan, I’m in a similar situation with my wife. My parents started with nothing and have done well financially and my wife’s family started with nothing but haven’t made it quite as far. Although we come from similar backgrounds, we vary vastly when it comes to finances and financial goals.
My parents have always been proactive with their finances, whether it was saving for me and my siblings college or planning for retirement. They recently purchased long-term insurance, to hedge against, God forbid, some unforseen medical emergency.
My wife’s parents, continually run up credit card debt, and every couple of years re-finace it through home equity loans. No self control what so ever when it comes to buying stuff. Continually buying junk for the grandkids (who have plenty of toys) which we end up giving away to charity. They have no retirement and no equity in their house. Where my parents have made conscious effort not to be a burden on their kids, the thought never crossed the minds of my wife’s parents.
With the rising costs of college education, one thing we did was open a college trust for the kids. Pretty successful so far although my wife’s parents have only contributed a small amount so far. (spend a lot more on junk) Probably because buying a savings bond for a grandchild doesn’t invoke the same reaction as buying a doll and kitchen set from Wal-Mart.