How to Save Money and Become Rich(er)
Would You Be a Miser
If you would become RICH from it?
Many a Little Makes a Mickle
During my professional career I learned that many a little makes a mickle (or muckle). The brain has the tendency to scan a list of numbers, pick out the big picture and overlook the many small numbers.
But the many small expenses result in much larger total amounts than we're initially aware of.
Managing personal finance properly is not easy, since paying with a cash card has become common practice. Paying with only cash money is much easier to limit. Especially when you put cash in several jars.
I am Dutch. Dutch have the name to be the most stingy and frugal people in the world. We have in Holland even special misers clubs - called De Vrekkenclub.
I guess everyone knows the proverb Going Dutch.
Compare These Two Bills
Which number caught directly your attention? The total sum of both lists is equal, but they look different, hey?
It's fully human that you only try to save money on the one number that caught your attention. We all know which one it is.
Saving money on bill 2 is not so easy - where to start? Therefore you must use budgets in your household. No matter how cheap it looks - if you haven't budgeted it, don't buy it. And buy only what you need on the short term.
He that can not keep a penny shall never have many
5 Cents - What Can We Do With This?
If You Haven't Budgeted It
Don't buy it then. No matter how cheap it looks. Look again at the two tables above, in some way your brain doesn't seem to digest the small numbers in the right column. Therefore is the main rule - if you haven't budgeted it - don't buy it, no matter how small.
Will your life turn into a counting hell? No, sure not. I will show you were the fun starts.
Two Ways - Earn More or Spend Less
Which one do you prefer? Most people are trying to earn more, which in most cases won't solve the problem of the negative cash flow. Higher earnings result in most cases in higher spendings.
Your time is the most valuable you have, so you can also try to spend less and cut costs.
Major Cost Items
The list of the most common expenses:
- Mortgage or Rent
- Car (loans) and Fuel
- Food and Household
- Energy bills
- Health Care
#1 - How to Save on Food
- Determine your week food budget and withdraw this cash once a week from your bank account.
- Safe this cash in for example a jam jar.
- Scan advertising brochures of groceries in your neighbourhood,
- Make always a shopping list before you go to a grocery store and stick to the shopping list.
- Estimate the total amount of your shopping list and take only this amount with you.
- Don't buy discount products you don't really need on a short term.
- Limit your supermarket visits to two times per week.
The average weekly spending of an American household on food is $151. We spend only $85 per week, while we live in abundance.
Savings: approximately $3,300 per year.
#2 - How to Save on Clothing
Second Hand stores have often very nice new or nearly new clothing and shoes for a fraction of the new price. We regularly perambulate three to four Second Hand stores in one round looking for the clothes and things we really need.
What you can do is make a list of Second Hand stores in your surrounding and make regularly a round trip along these stores - on bike. You'll have a nice healthy time, while you’re spending nearly nothing.
Our wardrobe is abundant, while we don't spent more than $200 per year on clothing and shoes. We always try to make bargains with the sales person, even on items of a few Dollars.
The average American household spends approximately $3000 per year on clothing and shoes.
Savings: approximately $2,800 per year.
Your Own Vegetable Garden
Your own vegetable garden doesn't have to be large. Just between 400 to 1000 ft2 is already large enough to eat vegetables during three months.
Growing your own vegetables is much healthier and tastier.
Savings: Up to $150 per year.
#3 - How to Become a Miser
Here are a few tips from the Dutch Misers Club, called De Vrekkenclub. The basic rule of the Vrekkenclub is that a real miser is never ashamed for his/her behaviour.
- Take all leftovers with you: milk cups, sugar bags and food.
- Never throw away food. You can make from a few little leftovers a whole meal again.
- Stoop for every penny you see on the street.
- Reuse paper for making shopping lists.
- Cut the tubes of toothpaste open when they're almost empty. There's still for a few days left.
- Never buy something that's not on sale. If you really need something on a short term, go to look for it in Second Hand stores.
- Never buy something you don't really need.
- Go at the end of the day to the market for fruits and vegetables. Most market vendors want to get rid of their merchandise. You can buy for less than $10 fruit and vegetable for the whole week. Be critical on the quality!
- Take used envelopes to send your post. Write on the front your own address on the back the address of the person to whom you want to send the letter. Paste no postage stamp! Strike through your own address and write refused return to sender. Put your letter in the envelope, close it and put it in the mailbox.
- Never give rounds in taverns. In the worst case - go Dutch :)
- Unpack presents very carefully, so you can reuse the packing paper. If the paper is wrinkled, you can iron it. Don't forget to put a towel between paper an iron.
- Read books you've got as a present very careful so you don't damage them. You can give them as a present. If you've by your stinginess no friends left - you can still sell the book.
- Give as much presents away you've gotten yourself.
- Never give tips.
- Take a shower only every two or three days.
- If you wash your hands, use as little water as possible.
- wear your clothes for at least two or three consecutive days. This saves many expensive washes.
- Stipulate always discounts, regardless the size of the amount. Don't feel sympathy for the seller. If you don't get your bargain - just leave the place.
Savings: approximately $ 2250 per year.
* source: Dutch Misers Club
Savings in One Year
Savings with this behaviour approximately $8,500 per year.
Conclusion - What Could be the Fun of All This?
Well, if you're married, have kids and your family isn't the same as you - this misers behaviour of you won't be stimulating for your family life.
But if in your family you're all in principle the same and like to live a little bit economical, you can have great fun during the misers practice.
After one year you've saved thousands of dollars that you can spend on things you want - like a holiday together once a year from the money you saved.
But you can also try to travel like Michael Wigge did!
If you have more tips from your own miser practice - you can mention this below. Thanks!
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