First of all, a bit of a disclaimer, this is not your average “how to save a buck” faux frugality article. This is extreme frugality or, better yet, what I have personally termed “practical frugality” that takes into account both the short term and long term scope of not only living within one’s means in the present but gradually over time reducing one’s need for money overall. I have a unique perspective, that of a stay at home mom who is also a homesteader pursuing a more sustainable and self-reliant lifestyle, which allows me more freedom than the average city dwelling wage slave in implementing a wide variety of strategies in the quest to reduce my need for money. I have written this article for people who are like me or on the road towards a similar goal.
The first rule of how to save money is to not spend money, even if you “think” you need to spend money, don’t spend money. PERIOD. I know that sounds ridiculously simple but once you have a deeper understanding of what exactly money is and what exactly you are doing when you spend it, it might be easier to refrain or, at the very least, be more discerning in how you spend your money.
Money, in our society, in it’s most basic form is a symbol of your labor. Your actual energy and time taken from your life is exchanged at a certain rate (your wage) for what we call money. It’s life-force converted into an easily transferable mode of exchange and this force is the power that runs the world. If you’re working for $10/hr. and buy a $10 shirt you just traded 1 hour of your life for that shirt..was it worth it? How about for a $5 fancy coffee? You just traded 30 minutes of your life for it…was it worth it? Or, for the stay at home moms, you really think that $50 new kitchen appliance will make your life easier but you just traded 5 hours of your husband’s life to make your own life easier…was it worth it? It really puts the constant spending of money into a different light when you look at it that way doesn’t it? 🙂
Foundationally, money is one of the main ways by which you can and continually DO influence the world around you. You’re like a battery, and when you spend money the people who run the companies that you give it to are receiving power from you and who exactly are you empowering? And what will they use their power for? In a very real sense you CAN decide who runs the world by simply being discerning in how you spend your money. It’s quite simple: Give your power (money) to the people you wish to support.
Money in and of itself is NOT inherently evil. I know that among certain christian circles it is fashionable to be poor (as if you get extra “brownie points” with God or something 🙄 ) using it as a mask to cover up certain character flaws such as laziness or lack of discipline and self-control which is, more often than not, the REAL reason for their poverty. However, Jesus very specifically said that the LOVE of money is the root of all evil! Having money and spending money, using it as the tool that it is, is not evil but loving it IS evil. I don’t love money, I actually HATE it, which is why I work as hard as I do to reduce my need for it and to mitigate as much as possible the power it has to harm me and my family by lack of it. I hate how society uses money, the having and the not having of it, to control the people. They make it practically impossible to live without it, even if you wished to opt out of the system entirely and live on a little plot of land providing the majority of your own needs you’d still have to find a way to make some money in order to pay your property taxes! It’s ludicrous and, sadly, it is also by design, you’re the battery that powers their system and the LAST THING they want is people opting out!
So, how do we achieve this balance? How do we reduce our need for money while, at the same time, having money enough to cover our needs and to prepare for unforeseeable calamities or disasters?
My husband and I have been selling on E-bay since 2003, at first it was part time while my husband still worked outside the home and we were saving money to buy our first house. Then, in the fall of 2005, when we bought our first house and moved from Maryland to West Virginia we went full time and, 10 years later, our E-bay sales are still our primary source of income. As you might expect, being an E-bay seller is not exactly the most stable source of income 😆 . We sell mostly video games so there are times, like during the holiday shopping season, when the money is just ROLLING IN! And then there are other times, like in September and October when all the kids first go back to school, that our video game sales drop off sharply and were lucky to even make a profit at all in those months. So, we’ve learned, out of necessity, an age old lesson that is really just plain common sense: In times of plenty, prepare for the inevitable famine. Fortunately, this also goes directly hand in hand with our homesteading/self-reliance/prepper/survivalist lifestyle 😀
All of the laws of the universe tend to operate around this “boom-bust cycle”. You have summer and then winter ALWAYS inevitably follows, there is NO stopping it! And how you prepare during the summer months (the boom cycle) determines whether or not you will make it through the winter months (the bust cycle). Most people, however, spend the summer months on vacation, lying on their backs in the sunshine with nary a care in the world. Then, when winter arrives, and they can’t buy food and they can’t heat their house ’cause they didn’t save during the summer months, they go a runnin’ to big mommy government with wide open mouths, like baby birds in the nest, expecting to be fed.
That’s why the first rule is: Don’t spend money. And the second part to that rule is: Instead, save that money for when you TRULY need it!
And what are your basic NEEDS?
First, you have oxygen, without it you may survive about 7 minutes but fortunately it’s still free (for now, but if they can find a way to make you pay for it, mark my word, they will!).
Next, you have water, without it you may survive about 3 days and most people in our society have to pay for it, they also pay for the water that is used to flush their waste away into the sewer. The easiest way for most people to buy water, in our society, is to receive it through “the tap” that runs into their home for which most people are paying either a rent or mortgage to live in, which makes shelter just as important as water.
So, you have oxygen first, then water/sewer and shelter together, and next comes food.
How long you can live without food varies greatly from person to person depending on how much extra fat they have stored on their body, which for the average american is quite a bit! 😆 Now unless you plan to eat at a restaurant for every meal or make a trip to the grocery store everyday you need someplace to store food, which would be your shelter. You also need some way of storing it so that it doesn’t go bad very quickly and some way to cook it. For most people, in our american society, this would be accomplished by using a fridge and a oven which, for most people, requires electricity and you need to be living in a home to have access to the electricity needed so you can store and cook your food. The majority of people in our society also require electricity to heat and cool their home.
Unless you are growing all your own food, you also need transportation to get that food to your house and, unless you work from home, you need transportation to get to your job to trade your life force (your labor) for money to buy the things you need to live. For most people this means owning an automobile of some kind, if you live in a city then you can probably get by with public transportation, you can also walk everywhere if you really have too but if it’s more than just two or three miles you have to seriously consider then how your time is being used. Those extra hours a day spent walking, other than making you more physically fit, are basically wasted hours that could be better used growing a garden or tending livestock (if you have the land for it) or possibly pursuing a secondary source of income, like selling on E-bay for example.
Not having transportation also limits other options. For example, it would be very hard to set up an adequate food storage system without the ability to buy and transport large amounts of food to your home. What if the grocery store is running that twice a year $1 each awesome sale on canned chili (which is an excellent storeable food btw) and you wanna buy 50 cans for your food storage? While you can transport it home by walking, it won’t be easy and maybe not even be worth it for the time spent. I suppose you might be able to get a ride with somebody but that isn’t reliable and plus they’ll probably be asking all sorts of stupid nosy questions, like “why in the world are you buying 50 cans of chili?!” (now for some people that might not be a big deal, but I HATE having to explain myself to others, just mind your own damn business!).
It also limits heating options. If you live in an area with bad winters it is not wise to rely on electricity as your sole source of heat, the first bad snow or ice storm and ZAP! it’s gone! and you freeze to death! – or, at the very least, you have a very miserable time trying to keep warm 😆 Having a source of heat, such as a wood stove or a kerosene heater, that is not reliant upon electricity is a very prudent choice. But, unless you harvest your own wood from your own land you would have to transport wood that you buy from someone else or have them deliver to you. However, owning a kerosene heater is a much more viable option for most people because a kerosene heater is cheap to buy (usually around $130 at the most) and does not require a chimney which makes it good if you live in an apartment or townhouse in a city, there are also kerosene cook-stoves that you can buy to cook your food on.
Kerosene is not all that much more expensive than heating with electricity, where I live electricity is 11 cents per KiloWatt hour which, when you do the math, makes kerosene only slightly more expensive than using electricity to heat a home and most people’s electricity costs are A LOT more expensive than where I live (but with all the closing of the coal plants that rate is destined to go UP unfortunately). Even though it is slightly more, the extra expense is well worth it for the added security of having a heat source and fuel that is not dependent on an electrical connection and can be stockpiled inside your home waiting and ready to go in case of an emergency. However, kerosene is quite heavy, most liquids weighing 8 pounds per gallon, and most kerosene containers store 5 gallons at a time so that is 40 pounds, and while it can be done it won’t be easy having to transport kerosene to your house on foot, especially to stockpile enough for use in an emergency situation. Again, you need some form of transportation to get it home.
Now, you could always rent a car once a month and stock up on the necessities, this is what we did when we lived for a year without a car (back in the fall of 2006 our car died and we didn’t have enough money to buy one and so took a year to save the money) however most people do not have enough money saved even to buy a month’s worth of necessities all at one time, fortunately though, we did 😀
So, from the data presented, I think it’s safe to say that the most important need is shelter ’cause without it you have no reliable source of water or electricity or a secure place to store and process the food that you procure (not to mention, it is also a place to sleep and store your clothing and keep you warm and dry!). I have never had a mortgage and I’ve haven’t had to pay any form of rent in quit some time, but when we lived in Maryland and rented an apartment the first thing we did, after paying off my husband’s school debt, our only debt ever, was save up enough money to cover 3 months of rent, we were paying $585/mo. at the time so we saved up an even $1800 reserved for rent payments should we ever, in the future, for some unforeseen reason, not have the means to pay.
We already owned a car that ran well, the biggest issue with it was the paying of the car insurance every year, so after we had the $1800 saved for rent we then saved enough to cover one year’s worth of car insurance expense should we ever, in the future, for some unforeseen reason, not have the means to pay.
Btw, you can also “pre-pay” other bills in this way. For example, most people’s water usage stays pretty stable resulting in relatively the same amount used in water each month, give or take a dollar here and there. So, take 1 month’s water bill and multiply it by 12 and save up that amount to have on hand so that you have the means to pay the water bill for a year. The same goes for trash pick-up, which is usually the same amount each month, we pay for the whole year all at once at the beginning of the year that way there is one less bill to keep track of. Or for electricity, especially when it comes to winter time heating, estimate the amount extra that it will cost each month to heat and multiply it by how ever many months you heat for and save up that total amount before the next winter hits, this way you already have it paid for!
After we had enough saved to cover 3 months of rent and 1 year of car insurance, we then created budgets according to the “envelope system” of saving, which most people are familiar with. Using different envelopes for the different budgets and putting the allotted money into the proper envelope each month. To this day we still do the same EXACT thing, but more through book-keeping a ledger than with actual physical cash in actual physical envelopes because a lot of our money is imaginary and in Paypal and in the bank account since we doing the majority of our buying and selling online. But we do have the ability to remove it ALL at a moment’s notice should we ever have to.
After we have paid all the bills for the month, the remaining profit is then spread, in percentages, over several savings budgets which are as follows:
General Savings: 30% – long ago this was our house/land fund for buying a house and land. Now, the money in this fund can, in theory, be used for anything but, in reality, it is used for nothing EVER! unless there is no other option, not just our “rainy day” fund more like our “when it rains, it pours” fund 😉
Health Fund: 20% – this is how we paid for a midwife in our recent homebirth, this is also how we pay for various herbal and nutritional supplements to keep the family healthy.
Car Fund: 10% – this is kept separately from the 1 year’s worth of car insurance, this fund is for regular car maintenance and any major car repairs or, heaven forbid, if we should have to buy a new vehicle 😛
Tithe Fund: 10% – we don’t attend church and we don’t give tithes, instead we set aside 10% each month reserved for people who God puts in our path and makes it evident that we should help them, having this set aside makes sure that the money is always there and ready to go at a moment’s notice!
Children’s Fund: 5% – mostly used for clothing, shoes and homeschooling books and supplies.
Entertainment Fund: 5% – we dip into this fund for various family outings, like going to the state fair or going out to eat, or buying something like a video game or new toy that the children want etc. etc.
Prepper Fund: 5% – yes, we have a prepper fund! 😀 This is used for purchasing anything homesteading/self-reliance/prepper/survivalist related and is also an extra fund in addition to general savings that we could dip into in a time of emergency.
Projects Fund: 5% – this funds various projects around the house and land, we used it this summer to build a 5 foot wide floor to ceiling bookcase, an island/bar for the center of the kitchen and a brand new bigger and better chicken coop!
Personal Money: 10% (5% for me and 5% for my husband) – a.k.a. “Mad Money” lol ..this is money that my husband and I each get every month to spend however we want on whatever we want without having to consult the other spouse or involve them in the purchase. This also provides incentive for us to be as frugal as possible because, the more profit there is leftover after paying all of the bills each month, the more each of us gets to spend however we want! 😀
Of course, all of this planning and saving is pointless if you do not have the discipline to limit your spending to the point where you actually have enough leftover at the end of each month to save. It is also pointless if you do not have the self -control to refrain from spending the money that you do manage to save, except for to spend it on that which the money is intended to be used. If you set rules and limits on yourself then, it follows, that in order to be successful you have to obey your own rules. For us, the “personal money” fund was key to making all of this work, at least in the beginning, after we got in the habit of saving though it just became second nature and now I could not imagine living life any differently!
Another thing I want to talk about is nutrition and the food budget. Most people tend to spend money on food in a way that makes no sense, buying and eating things that are extremely unhealthy, especially things full of sugar and trans fats which are proven to harm your health, and the eating of which will just cost them money in medical bills in the long run. I buy very little anything with much sugar in it, definitely no soda, only small amounts of 100% grape juice and I definitely don’t buy any baked goods or dry boxed cereal or anything like salad dressing or mayo containing soybean oil which is also extremely unhealthy. If we wish to have a treat, such as birthday cake for example, I make it at home from scratch using things like real butter and eggs from our hens and milk from our goats. Instead of dry-boxed cereal we eat oatmeal made from organic oats that I buy in 50 lb. bags. I also make our own salad dressings using things like real extra virgin olive oil and raw apple cider vinegar along with fresh-cut herbs from the garden and my own mayonnaise using eggs from our hens. Doing all of this saves a tremendous amount of money on the food bill while at the same time ensuring that we consistently eat REAL whole foods that nourish our bodies rather than destroy our health…saving us TREMENDOUS amounts of money in the long run. Money that will never go to line the pockets of some stupid pharmaceutical company!
The most nutritious thing you can eat is meat, animal flesh, and protein in the form of eggs or dairy products that have been fermented like plain whole milk yogurt and cheese. Even if the only thing you can afford is just regular ol’ commercial quality meat and protein it still has MORE nutrition and calories per dollar than regular non-organic commercially raised fruits, veggies and grains. Most people try and say that veggies and fruit are healthy, but I beg to differ. They CAN be healthy if they are organic and raised up in soil that hasn’t been nutritionally depleted, for the product only contains as much nutrition as the soil it was raised in. Most of our produce we eat in season and a lot of it we grow ourselves, if I want a tomato or berries I don’t buy them from the store in the middle of winter, NO! they are treats reserved for eating at their specific time in their specific season, to do otherwise is quite simply just retarded, and not just from the perspective of taste but also from the perspective of getting the most nutrition for the money. And if you want the most calories for the money buying these things NEVER makes sense for fruits and veggies contain very little calories, but raising them on your own land and consuming them in season makes PERFECT SENSE! 😀
Therefore, the basis of the majority of our meals is meat and protein. We eat A LOT of eggs that we raise ourselves, along with those eggs there are potatoes, both ones that we grow or organic potatoes that I buy from the store or the organic oatmeal that I mentioned earlier, occasionally we have homemade from scratch pancakes topped with butter and raw honey along with bacon or sausage on the side, these meals make up 99% of our breakfasts. Lunches and dinners are mostly just meats/proteins with a side of either organic potatoes, organic brown rice that has been soaked, sometimes sprouted, and then cooked (I buy this in 50 pound bags), organic beans that have been sprouted and then cooked (I also buy these in 50 pound bags) or 100% whole wheat bread that I make with flour that I grind myself from organic red spring wheat that I buy in 50 pound bags. Buying organic food in bulk from a co-op makes it FAR more economical than buying it in smaller packages from the grocery store.
And if you are a homesteader like me, one of the best ways to get the most nutrition and calories for the money and time spent is to raise your own milking animals, either goat or cow, and consume their milk raw and use it to make everything from butter to cheese, yogurt and even your own ice cream! Raw milk contains loads of easily assimilable nutrition, including things like antibodies that keep your immune system running smoothly. When our goats are in milk and we are consuming that milk on a regular basis we rarely get sick, the last time our goats were in milk my kids went 16 months without getting sick and, when the milk ran out and they eventually did get sick it was just a simple runny nose type thingy that dried up in about three days with no lingering after effects or secondary bacterial infection. You just can’t go wrong when you grow your own!
I plan to follow this up with a part two on more ways to save money, so keep on the look out 😀