While not specific to living car free, there is a lot of interest in this forum for frugal living. So i thought i'd post a couple great information sources I've come across recently:
Smart Money magazine: this month's (July) issue has a section called "7 Money Mistakes to Avoid". Simple stuff that seems obious on the face of it but that many people, even smart people, fall into. Stuff like thinking a tax refund = mad money, the "sunk cost" effect where people hold onto a bad decision based on how much time & effort they've already put into it, etc. I've been guilty of a few...
Living on a Dime: www.livingonadime.com/money-saving-articles.htm. Great stuff in there, esp. for folks just starting to manage their finances. I've referred a few friends & relations to this site. one or two of them kinda took offense at the name of the site, saying "it must be for poor folks". I gently reminded them they were $8k in credit card debt and living paycheck to paycheck... they came around.
Fool.com: another great place, starts where Dime stops, introduces you to investing, how the financial world we live in works, etc.
please contribute your sources for guidance as you see fit.
gosmsgo
06-13-07, 08:10 AM
Dave Ramsey
He is a radio host that believes in no debt.
gwd
06-13-07, 08:32 AM
The most influential thing for me was studying Engineering Economy. Its all about analyzing money decisions based on the time value of money. In most decisions you make, including transportation, the timing of payments or disbursements don't align so you have to make adjustments in order to compare two courses of action. The sunk cost fallacy that you mention is only one way that people make poor decisions or sharp operators take advantage of you by muddling your money thinking. It is really helpful in negotiations about things like escalation clauses and discounts. For living car free knowing about how to compare cash flows during different time periods is essential for rationally comparing transportation options and not confusing accounting conventions like depreciation with real cash flow.
jamesdenver
06-13-07, 08:39 AM
This is my system: Don't buy stuff you can't afford. (http://consumerist.com/consumer/debt/snl-skit-dont-buy-stuff-you-cant-afford-252491.php)
acroy
06-13-07, 09:00 AM
This is my system: Don't buy stuff you can't afford. (http://consumerist.com/consumer/debt/snl-skit-dont-buy-stuff-you-cant-afford-252491.php)
most excellent :)
gosmsgo
06-13-07, 09:34 AM
The thing that has helped me the most is to never think about things in terms of payments.
Cell phone - Would I write a $450.00 check right now to use a cellphone for a year? NO
Internet - Would I write a $450.00 check right now to have internet at home for a year? NO
etc. etc. etc.
Right now the wife and I save 50% of our take home pay every month due to this system. My wife is a full time student and I still find it very easy to do this.
We put our grocery money, wifes spending money, my spending money in different envelopes every month. When the money is gone, its gone. No borrowing, no credit cards and no debit cards.
It works. Money that is not told what to do will soon be gone.
When we dont do the envelope method we somehow spend $300-$800 more a month. I have no idea where it goes. :D
Nightshade
06-13-07, 09:46 AM
The thing that has helped me the most is to never think about things in terms of payments.
Cell phone - Would I write a $450.00 check right now to use a cellphone for a year? NO
Internet - Would I write a $450.00 check right now to have internet at home for a year? NO
etc. etc. etc.
Right now the wife and I save 50% of our take home pay every month due to this system. My wife is a full time student and I still find it very easy to do this.
We put our grocery money, wifes spending money, my spending money in different envelopes every month. When the money is gone, its gone. No borrowing, no credit cards and no debit cards.
It works. Money that is not told what to do will soon be gone.
When we dont do the envelope method we somehow spend $300-$800 more a month. I have no idea where it goes. :D
This is the way our grandparents (and some parents) lived before the days of credit cards and
easy credit. It works because it's time proven. ;)
Credit card companies and banks DO NOT want you to know this or think like this.
vulpes
06-13-07, 11:12 AM
My strategy includes not even having a bank account or credit card(s) and buy everything I can second hand. The only things I will buy new are things that are so specialized that it would take months or years to find one second hand. Things like the new cassette for my bike, handlebar mirror, etc. I like to figure out how to make or cludge things for myself instead of buying something, when I can.
One good example is my rack trunk. I kept an eye out for a bag or box of suitable size and shape at the thrift shops and flea markets for a few weeks. A couple of weeks ago I spotted a golf bag (the kind to keep balls, tees, cleat cleaner, etc. in) just the right size for $4. To attach it to the rack I rigged up some bamboo stays (about $1.50) that hold it firmly but allow me to detach it easily when I don't want to leave it on the bike. So instead of spending $60-$90 on a rack trunk that I may not have been completely satisfied with, I got just what wanted for $5.50 and a little time and patience.
scottyk
06-13-07, 11:26 AM
One good example is my rack trunk. I kept an eye out for a bag or box of suitable size and shape at the thrift shops and flea markets for a few weeks. A couple of weeks ago I spotted a golf bag (the kind to keep balls, tees, cleat cleaner, etc. in) just the right size for $4. To attach it to the rack I rigged up some bamboo stays (about $1.50) that hold it firmly but allow me to detach it easily when I don't want to leave it on the bike. So instead of spending $60-$90 on a rack trunk that I may not have been completely satisfied with, I got just what wanted for $5.50 and a little time and patience.
I went to Menards and bought a small Rubbermaid container. I think it was $3.99 or so. Tied it to my rear rack and viola.
alicestrong
06-13-07, 11:29 AM
A couple of weeks ago I spotted a golf bag (the kind to keep balls, tees, cleat cleaner, etc. in) just the right size for $4. To attach it to the rack I rigged up some bamboo stays (about $1.50) that hold it firmly but allow me to detach it easily when I don't want to leave it on the bike. So instead of spending $60-$90 on a rack trunk that I may not have been completely satisfied with, I got just what wanted for $5.50 and a little time and patience.
I'd love to see a pix of this...please?
lyeinyoureye
06-13-07, 11:36 AM
Ehm... craigslist, fatwallet, slickdeals, thrift stores, yard sales, cheap food, DIY, help forums, and most of all, not buying **** I can't afford.
morea
06-13-07, 11:37 AM
I'm not totally car-free, but I do have some thoughts to contribute to this thread. :)
- A simple and realistic way to make a difference is to pack your own lunch and bring it to work instead of buying take out every day. You can even get frozen dinners for less than half the price, but sandwiches are ridiculously inexpensive and usually healthier for you, too. It's scary when you figure out how much that saves you over the course of a month.
- Buy in bulk whenever possible. This goes for food, drinks (buy yourself a case of beer or a box of wine and drink it at home with friends, it's MUCH less expensive than going out to a bar or restaurant), and whatever else. I make big batches of food (like chili) and freeze the leftovers, which also saves me time the next time I get a craving.
- Fix things when possible instead of buying new ones. I sew up socks, sweaters, etc. unless they are beyond help. I fix jewelry with superglue.
- Don't keep up with the Joneses. You don't need the latest gadgets, even if you might want them. You got along without them up until now, but if you reallllly want them, always wait for them to go on sale. I don't "need: a cell phone, so I don't have one.
- Don't shop when you're hungry, don't buy things on a whim. I find that when I go to the store I will invariably find a bunch of things that I want to have... fine. I may even put them in a shopping cart and walk around with them for a while... then before I go to the checkout I look at how much they cost, how many hours I would have to work to pay for them, and then I decide that I DON'T want them that much, and put almost everything back. All the "fun" of shopping (if you're into it) but with none of the debt!
- I've never had a "real" vacation (like a cruise or a trip to Europe) but if I want to 'get away' for a while I go camping, or stay with a friend (who is equally welcome to come and stay with me). You can have a great time on a shoestring budget that way.
- "Just say no" to instant gratification. If you want something, save up for it instead of putting it on your credit card. As a bonus, by the time you have the money for it, chances are that the price will go down a little. http://s154138679.onlinehome.us/smf/Smileys/default/smiley.gif
- Wait for movies to come out on video/DVD. A $3 rental is a lot cheaper than a $10 theater ticket... and you can watch it as many times as you want to.
- Obviously, biking to the store and back instead of driving saves you money on gas and oil changes, etc., but it's also a great form of entertainment and exercise. I don't need a gym membership to keep fit, and I get plenty of fresh air to boot. Regular exercise can also keep your immune system strong so you don't have to pay for as many doctor visits and prescriptions.
vulpes
06-13-07, 11:43 AM
I'd love to see a pix of this...please?
As soon as I get access to a digital camera, I'll be most happy to post pics.
gosmsgo
06-13-07, 11:55 AM
another tip would be to get grocery coupons at a online site like www.grocerygame.com
The whole point of coupons is to get you to buy things that you werent going to in the first place so make sure its really something you need anyway.
Most times generics are still cheaper then name brands even with a coupon. I still save about 3-5 dollars a week in groceries though.
acroy
06-13-07, 12:03 PM
The whole point of coupons is to get you to buy things that you werent going to in the first place so make sure its really something you need anyway.
i hear ya there... whenever i used coupons, i bought more stuff than I needed. so i don't bother now, just adjust my eating habits to what's on sale ;)
cheers
mgbguy
06-13-07, 12:14 PM
As soon as I get access to a digital camera, I'll be most happy to post pics.
Probably won't be soon though since you wouldn't buy a camera.:D
r8ingbull
06-13-07, 12:25 PM
This is my system: Don't buy stuff you can't afford. (http://consumerist.com/consumer/debt/snl-skit-dont-buy-stuff-you-cant-afford-252491.php)
don't buy stuff you don't need....
squegeeboo
06-13-07, 12:28 PM
i hear ya there... whenever i used coupons, i bought more stuff than I needed. so i don't bother now, just adjust my eating habits to what's on sale ;)
cheers
Ha, when I used to work as a cashier this co-ed came down my line and gave me coupons for a bunch of stuff like Oreos, and started chatting about how she would never buy them normally but her mom had sent her coupons, so now she was saving money.
I took the 30 seconds to explain to her that if she normally didn't buy them, but now she was, she was actually spending money not saving it.
You could see the light bulb turn on and then she got annoyed at her mother, who thankfully wasn't there.
gosmsgo
06-13-07, 12:29 PM
Ha ha.
Like I said, if you only use coupons for stuff that you were going to buy anyway then it works.
Artkansas
06-13-07, 12:31 PM
This is my system: Don't buy stuff you can't afford. (http://consumerist.com/consumer/debt/snl-skit-dont-buy-stuff-you-cant-afford-252491.php)
:D
I went to my nephew's wedding last weekend. I noticed that my niece has a big screen TV, a new car and a house. I don't have any of those things and I know I make more money than she does. It made me feel like I was lacking something. Then I realized what it was.... debt.
vulpes
06-13-07, 12:38 PM
Probably won't be soon though since you wouldn't buy a camera.:D
You got that right. I'm an old timey 35mm SLR kinda guy. My son has an old digital that takes a 3.5 floppy :rolleyes: . I don't know how good the res is, but I he already offered to let me use it.
I-Like-To-Bike
06-13-07, 12:49 PM
don't buy stuff you don't need....
Like who needs a camera that will do what you want done, when you have one that won't, eh?
r8ingbull
06-13-07, 12:53 PM
Like who needs a camera, eh?
Not me...
A photographer needs a camera.
timmhaan
06-13-07, 01:01 PM
:D
I went to my nephew's wedding last weekend. I noticed that my niece has a big screen TV, a new car and a house. I don't have any of those things and I know I make more money than she does. It made me feel like I was lacking something. Then I realized what it was.... debt.
yep - exactly! i could have a lot of other things, and could easily afford them (even without going into debt).
however, i don't want to be working my whole life. i want to retire! and i want it to be a good retirement. so, week after week, money goes into my 401(k), investment account, and a savings account. i never even get a chance to put my grubby paws on it.
Nickel
06-13-07, 01:24 PM
Someone mentioned buying in bulk and for me that has helped save a lot of money. I have purchased several containers which I can use to fill up cereal, cat food, rice, pastas, dried fruits, condiments, peanut butter and washing detergent at the local co-op. Not only do I get to save money, but I get to reduce my waste stream. My partner and I try to only spend one grad student salary and save the other paycheck. We only use savings acct and CDs until we can research more investment options.
acroy
06-13-07, 01:45 PM
We only use savings acct and CDs until we can research more investment options.
check out fool.com and get yourself an account at Firstrade or some other discount online broker - let that money work for you!
cheers
JR97
06-13-07, 02:10 PM
I took the 30 seconds to explain to her that if she normally didn't buy them, but now she was, she was actually spending money not saving it.
That's called the Law of Inverse Spending. I love it. It simply states that when it comes to MY spending, I'm actually saving. I'll apply it when I buy two of something because it's on sale because I"m saving money. Or stuff I can get off of ebay. This law is totally one sided and not open to interpretation or correction. :p
Seriously though, I have a hard time spending $5 on something. It takes me weeks and sometimes months to make a buying decision. Drives my wife nuts. She's the type who buy whatever and whenever because as she puts it, "hey, if we can't afford it, I can always take it back" blah blah blah. I think she has some emotional attachement to the act of shopping.
Elkhound
06-13-07, 02:30 PM
No bank account? What do you do with your money? Stuff it in your mattress? You get no interest that way and it could be easily lost or stolen. And what about when you can't use cash for something? Money order purchasing fees add up.
vulpes
06-13-07, 02:35 PM
Yeah, some people think cars are an absolute necessity, others think that banks are absolutely necessary. I fall into neither category. :)
I-Like-To-Bike
06-13-07, 02:37 PM
Not me...
A photographer needs a camera.
Yeah makes lots of sense;:rolleyes: just like only vegetarians need vegetables.
squegeeboo
06-13-07, 02:42 PM
Yeah makes lots of sense;:rolleyes: just like only vegetarians need vegetables.
It's true. Meat Cheese and Grains FTW!!
makeinu
06-13-07, 02:57 PM
Yeah, some people think cars are an absolute necessity, others think that banks are absolutely necessary. I fall into neither category. :)
So where are you investing your savings?
gosmsgo
06-13-07, 03:00 PM
I am definetely a fan of banks.
I could not imagine a fire or theft whiping out my entire savings.
s c a r y!
vulpes
06-13-07, 03:06 PM
So where are you investing your savings?
In frugality? ;)
wheel
06-13-07, 04:10 PM
Pretend you're primitative camping.
Don't buy things you won't use/eat wisely.
I invest my money into College :)
UrbanChicago
06-13-07, 06:35 PM
We only use savings acct and CDs until we can research more investment options.
One option I suggest you look into is www.treasurydirect.gov. The US Treasury runs it and allows you to cut out the middleman, buying Treasury securities with ZERO commission. I like the 6-month T-Bills over CDs right now. The rates are pretty similar and the risks are much lower. The 3 and 6 month T-Bills are the easiest government securities to understand too.
"Old-fashioned" oatmeal is healthier and cheaper than the quick/instant oatmeal. The thing is, when cooked in the microwave it's pretty much just as fast.
I grow a few veggies and herbs in my window. You can buy seeds that are ideal for the indoors - that don't grow very large. A couple bucks for some seeds and a little TLC every morning and you can save $50-100 in a summer.
Platy
06-13-07, 06:57 PM
...however, i don't want to be working my whole life. i want to retire!...
Working less and playing more is a worthy goal in life. It's not for everyone of course, and for people without the foresight to be born heirs to some great fortune it implies a certain amount of frugal living somewhere along the line.
531phile
06-13-07, 07:21 PM
yep - exactly! i could have a lot of other things, and could easily afford them (even without going into debt).
however, i don't want to be working my whole life. i want to retire! and i want it to be a good retirement. so, week after week, money goes into my 401(k), investment account, and a savings account. i never even get a chance to put my grubby paws on it.
This is exactly what the author of Automatic Millionaire says, automate savings so you don't have the opportunity to touch it and blow it on stupid stuff that you don't need.
gerv
06-13-07, 09:28 PM
Working less and playing more is a worthy goal in life. It's not for everyone of course, and for people without the foresight to be born heirs to some great fortune it implies a certain amount of frugal living somewhere along the line.
Platy, this is an excellent reason to become frugal. Frugality in itself seems like a useless goal, but when you look at it this way... it has excellent side effects. I just wish more people in our society could subscribe to these goals. Also, goals like "slow down" and "relax" and maybe "smell the roses" ... and finally maybe what Voltaire said about cultivating your own garden.
r8ingbull
06-14-07, 05:57 AM
Yeah makes lots of sense;:rolleyes: just like only vegetarians need vegetables.
Your smart ass post makes no sense.
You asked "who needs a camera" I said "not me" and "a photographer needs a camera"
Had I stated that only a photographer needs a camera you might be closer.
Also a camera is a semi durable, re-usable item. Vegetable are a consumable food item.
If I want to use a camera, I simply walk to my parents house, grab theirs and use it. Saves me $200+...
CaptainTandem
06-14-07, 07:33 AM
This is my system: Don't buy stuff you can't afford. (http://consumerist.com/consumer/debt/snl-skit-dont-buy-stuff-you-cant-afford-252491.php)
Or ... don't really need at all.
I-Like-To-Bike
06-14-07, 10:49 AM
If I want to use a camera, I simply walk to my parents house, grab theirs and use it. Saves me $200+...
Why don't you save more money by living in their basement for free?
Roody
06-14-07, 11:02 AM
Why don't you save more money by living in their basement for free?
Spiders.
Roody
06-14-07, 11:08 AM
As far as buying groceries in bulk....
The opposite approach works for me. I buy small amounts of food as I need it. Rarely more than I can fit in a back pack. I don't have to mess with cargo systems for my bike. My fo9od is always fresh and much of it is locally grown, so not much enegy is used getting it to me. I buy from the farmer's market and local bakeies, butchers, etc.
I never have much food in the house, so I'm not tempted to overeat as much. For example, if I crave ice cream, I have to ride out to get some. By then the craving goes away, or at least I've burned off a few calories satisfying it.
r8ingbull
06-14-07, 11:57 AM
Why don't you save more money by living in their basement for free?
Because while it might be free for me it would cost my parents additional money. Plus the value per dollar of owning your own house is very good, maybe even one of the best value items you can own...
I-Like-To-Bike
06-14-07, 01:18 PM
Spiders.
Free chow/good company for the really frugal!:)
ModoVincere
06-14-07, 01:21 PM
Free chow/good company for the really frugal!:)
Hey...protein is protein :eek:
I-Like-To-Bike
06-14-07, 01:24 PM
Hey...protein is protein :eek:
Save that line for some other appropriate moment.
timmhaan
06-14-07, 01:30 PM
This is exactly what the author of Automatic Millionaire says, automate savings so you don't have the opportunity to touch it and blow it on stupid stuff that you don't need.
yes. in fact, unless everything falls apart, i will be the first millionaire in our family history. it will take a while longer, but it should happen. i've actually been committed to this goal since i was about 13 years old and fell in love with the magic of compounding interest.
Artkansas
06-14-07, 02:50 PM
As far as buying groceries in bulk....
The opposite approach works for me. I buy small amounts of food as I need it. Rarely more than I can fit in a back pack.
Yep, it's hard to buy fresh veggies and fruit in bulk if you are single, espcially bananas.