- Personal Finance
Financial Strategies You May Have Overlooked
I've been a student of the penny-pinching lifestyle for several years now, as making do with what we've got has always been an issue for our one-income family. However, when it comes to saving money, I've noticed that there's more than one way to enhance your financial situation, and pinching pennies is a smaller piece of the financial picture. Pinching pennies is a very valid practice, and one that I consider myself to be pretty good at. But there are other ways to save money--ways that don't seem like saving money at all.
At first, my thoughts may seem more like life strategies than they are tips for saving money, but if you put them into practice, you will be amazed at how quickly your expenses decrease, and how abundantly you find your needs met.
Note that this article is not intended to promote using people to get what you want. Lots of people who use the following strategies could be placed in the category of using others to get what they want, and that is not at all what I am suggesting here. Using others for this purpose is pretty despicable, and you will know if you have crossed that line.
Put the Word Out
In her book the Tightwad Gazette, Amy Dacyzn revealed a concept that changed my life. There's no other way to put it. The concept is "putting the word out."
Putting the word out is simply telling everyone you know in as unobtrusive a way as possible what your needs are. Putting the word out is not a request for a handout. It is more like advertising a need without asking for help. The object is not to beg or request help inappropriately. Instead, you are telling your universe of friends and acquaintances what you are looking for. Here are a few examples of how this works.
My friend is a pro at this life skill. She always puts the word out before she jump to buy something she needs to use. If she needs to paint her house, she puts the word out, and suddenly someone is painting her home in exchange for something she can do for them. It is useful in big needs like this to have a willingness and an ability to trade a skill with someone.
Another example of putting the word out is when your toddlers are outgrowing their cribs or toddler beds, and you need to find new furniture. As likely as not, someone has outgrown their need for something you are now seeking. Put the word out. "Johnny has outgrown his toddler bed and I'm looking for a single bed in decent condition. Do you know of anyone?"
The trick to putting the word out is living life generously, so that when it is your turn, you can accept a gift without guilt. So when you have something you think might be of value to someone else, but it isn't of value to you anymore, put the word out. Offer it as a gift from the heart and build a little bit of social equity in your network of friends and family.
Now I'm going to point out the obvious. If you don't make friends easily or have a good social network, you're still in luck, because putting the word out has never been easier with the invention of Freecycle. So join your local chapter and be generous. You can apply this same principle on sites like Craig's List, which has gotten a bad rap these days. One person I know was looking for canning jars, so she put a want to buy ad out. She got her jars for less than half the cost she would have paid new.
One more thing: I have a great refrigerator in my garage. Do you know anyone who needs a fridge? The price is less than a quarter of what I originally paid for it, and it works fine. See! I just put the word out!
Streamline as many areas of your life as possible. Get rid of junk you don't need so that someone else can enjoy it. Fill your day up with fewer planned activities. Remove your focus from impossible hopes of perfection.
Are grocery costs making you crazy? Find three low-cost meals you love to prepare and make them on the same day every week. Now you can purchase quantities of ingredients that you need to make these meals, and you've just reduced the amount of time and money you need to spend on buying groceries, simply because you had a plan.
Too many clothes in your closet and nothing to wear? Identify 5 or 10 outfits you love, and pack the other things away. Better yet, put the word out and find someone who could use them. You weren't wearing the other 80% anyway.
Find Less Expensive Ways to Practice Your Expensive Hobbies
I had an expensive scrapbooking hobby that cost me a small fortune in paper, stickers, and photo developing. Until I discovered the magic of making movies of my photos and burning them to DVD. Now I have a spectacular low-cost gift and an electronic scrapbook with unlimited options for creativity that costs pennies on the dollar compared to making the paper crafts.
Incorporate your hobbies into things you have to do every day. For me, this hobby is cooking homemade Italian breads, like Focaccia, pizza, and filling winter soups. About once a week I go on a baking binge and my family adores the results. Since baking from scratch is cheaper than eating out, it is a good economy for my family.
Do you love to exercise, but the gym membership is an area you know you could trim? Buy a bike and hit the road, or better yet, find a walking partner who loves to talk and schedule some exercise time outside with your friend and ditch the gym membership.
Live Life Generously
Don't be afraid to give of yourself. If you have talents you can share with others, by all means, do so. One of the most rewarding things I ever did was to volunteer as a storytime presenter. I entered the world of storytelling and early-childhood literacy and had a wonderful time. I met parents who had young children, I contributed something positive, I felt good about myself, and I gained so much more than I gave. I'll never look back, and I'll never regret it.
Living life generously will look differently to different people. Different strokes for different folks, after all. The point is, you will feel rich, emotionally. Maybe you are handy with fixing motors. You notice your neighbor next door has an issue with their car that you could easily fix. You offer to spend a few hours and save them an enormous amount of money and you probably will gain a loyal friend doing this.
Let me reiterate that I'm not encouraging you to do these things merely for the sake of expecting something in return. But chances are, if you are in the habit of helping others, when the time comes, help will come your way.
In Financial Matters, Look at All the Angles, Then Ask For Advice
Do you have someone in your life that you know is really really smart with their money? Are you using that person to seek financial advice? How many life-altering financial decisions have you made in a vacuum that turned out well? My suggestion here is not to find the person who will ridicule you for all the stupid choices you've made in the past, or someone who will pass judgement on the choices you will make in the future. The person ideally is someone who has something valuable to say but who also will give you your space to make your own choices.
If you are looking at big financial decisions, like how to invest your retirement money, whether you should sell your house and move to a different area, or what type of loan you should take out, investigate the options first. Then run your scenarios past your trusted advisors. And don't take it personally if they think you've overlooked some major point. It could save you thousands of dollars and plenty of heartache.
Build Your Family Network
If you don't have a network of family or friends, you are missing out. No man is an island. With a network of friends, you have someone else to help you shoulder the burden.
A person without friends or family needs a last minute babysitter. They are new to the area and suddenly have access to symphony tickets. But they can't go because they don't know or trust someone to watch their kids. The windfall becomes an object of resentment.
A person with friends has no problem in this scenario. "Hey (insert friend's name)" are you free to take little Suzie and Johnny this weeked? I'd be glad to trade you for next weekend. Of course you have to really mean it and do a great job watching your friends' children. It is worth it. My babysitting costs with three children can be very high.
Your family network also is a reliable source for putting the word out and building social equity. Social equity has financial counterparts. When your family network shows up to help you move or paint your house, you'll know what I mean.
Don't Create Limits for Yourself
People who place limits on themselves are never happy in the end. This is a factor of the simple truth that life is never quite how you thought it would be, and the opportunities in life are usually disguised as trials.
We recently left our last job to accept a job that amounted to a 20 percent pay increase. The job has better health insurance, better benefits all around, and much greater opportunity for career growth. In addition my husband has already been sent on a week-long training seminar for a specialized museum database that will increase his marketability. But this opportunity came in disguise, because the job title appeared to be less than what he was doing before. Someone who had limited their job search to "lead" or "head" roles would have missed this important change for our family.
Try to be aware of the limits you create in your life. Are you only willing to look at jobs in one career field? Looking for housing, but only in a certain zip code? Only willing to date blondes because brunettes don't usually have blue-eyed children?
Buy One Expensive Luxury Item, then Invest in Your Relationships
Find one thing that brings you great pleasure, and allow yourself to spend some money on it. For me, that might be a pricier camera than the frugal momma inside of me would normally allow. But that one luxury will bring me enormous pleasure and satisfaction. The key to this concept is knowing what you truly enjoy. Don't splurge on things because your neighbors are doing it or because you think it's what you're supposed to do. Find what you love first, focus on developing that, and let the other things fall away.
Now that you have something you really love, stop thinking about the stuff and focus on developing the relationships within your family. I'm a woman who thinks relationships are pretty important. And if you think this is frivolous, consider the cost of divorce, stress-related illness (heart disease or chronic migraines), therapy, and living alone without family or friends during your golden years. Isn't it better to cherish those we love and work on our problems with our families than these costly alternatives?
Focus on building up those around you and creating a haven in your home for your children. Be accessible. Be there. Be positive. Believe in your kids and cheerlead your spouse. You will be positively rich.
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