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  1. #1
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    How to Save Money on a Small Income

    Here's a silly article on how to save BIG money on a small income. It listed ideas such as savings your $5.00 dollars bills in a coffee jar or sock money each month for your car insurance! How about getting rid of your car insurance by comming car free?? It's insane how someone making 18K a year can afford to drive a car in the first place.

    All of those so called savings plans are just wishful thinking because a car will bleed you to death. There is no way you can save on that little bit of money when 20% of your income is going on transportation costs. All those 5 dollars bills in that coffee jar will end up paying for gasoline. I couldn't save any money at twice that income while owning a motorcar.

    I think we can come up with a better solution on how to save money on a small income. I'll start it off right now and you can forget looking for pennies in your couch!

    1. Sell your car and become carfree.

    http://articles.moneycentral.msn.com...inyIncome.aspx

    From the article:
    >>>>10. Divide and conquer. Divide the total amount of your car insurance (or other irregular expense) by 12 and sock away that amount each month so you don't get caught short. Lea says she won't blow her holiday budget this year because she's used this system to save each month for gifts.<<<<

  2. #2
    Senior Member wahoonc's Avatar
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    Steve,
    I agree with your assesment of the car bleeding you to death. But! that is the beauty of budgeting, if you do it right it will show you exactly how much money you have and where it is going. And that is one of the reasons I don't have cable TV. We are only home 80 some days out of the year, why would I want to pay $70 a month for something I'm not using less than 20% of the year If you do it right it is a real eye opener. Unfortunately most people don't do it and have no clue where their money goes. Wanna guess how much my beautiful bride was spending on Sweet Tea and bottled water? (Hint: it was enough to buy a tank of gas a month ) but the budget/tracking showed it, and now she takes it from home in a thermos.

    Aaron
    Webshots is bailing out, if you find any of my posts with corrupt picture files and want to see them corrected please let me know. :(

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    Which one would you rather have under your butt at 30mph?"
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  3. #3
    Humvee of bikes =Worksman Nightshade's Avatar
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    Reams of money saving tips to read on this site..........

    http://www.stretcher.com/index.cfm

    The topical index is HUGE!!

    (removed my OP as it was.....well....dumb. )
    Last edited by Nightshade; 08-19-06 at 12:33 PM.
    My preferred bicycle brand is.......WORKSMAN CYCLES
    I dislike clipless pedals on any city bike since I feel they are unsafe.

    Originally Posted by krazygluon
    Steel: nearly a thousand years of metallurgical development
    Aluminum: barely a hundred, which one would you rather have under your butt at 30mph?

  4. #4
    You know you want to. Eatadonut's Avatar
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    Quote Originally Posted by Dahon.Steve
    All of those so called savings plans are just wishful thinking because a car will bleed you to death. There is no way you can save on that little bit of money when 20% of your income is going on transportation costs. All those 5 dollars bills in that coffee jar will end up paying for gasoline. I couldn't save any money at twice that income while owning a motorcar.
    Making statements like that doesn't make you more credible with the driving crowd, no matter the response you get here preaching to the choir.

    What kind of car are you theoretically driving that you can't afford to put any money in savings while making 32k a year?
    Weather today: Hot. Humid. Potholes.

  5. #5
    Sophomoric Member Roody's Avatar
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    Quote Originally Posted by Eatadonut
    Making statements like that doesn't make you more credible with the driving crowd, no matter the response you get here preaching to the choir.

    What kind of car are you theoretically driving that you can't afford to put any money in savings while making 32k a year
    ?
    How much do you spend on your car?


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    I currently sit in the $28,000 range. With all my bills right now, i'm looking at about $700/month in expenses. I probably could drive if I wanted to, but even for a beater I bet it would cost me at least 100+ per month, and that's just making 1-2 trips per month for the groceries, with insurance at $50-70. Plus, my moral conscience would hate me for it.
    yep.

  7. #7
    You know you want to. Eatadonut's Avatar
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    Quote Originally Posted by Roody
    How much do you spend on your car?
    A 1992 Toyota Tercel will run you about $2000 in good condition, and probably cost you a quart of oil every month ($48/yr). $3/gal for gas, you get ~30mpg at the low end. So you drive 20 miles a day, that's ~7500 miles a year. ~250 gallons of gasoline, that's $750.

    So if I bought a new used tercel every year, I'd spend $2800 annually to have a car. If I kept that tercel for 4 or 5 years, my annual costs would be lower.

    So now that's out there, what are you spending the rest of your $29,200 on?

    EDIT: insurance, of course. Call it $75/mo, so an extra $800 a year. Now you only have $28,400.
    Weather today: Hot. Humid. Potholes.

  8. #8
    bragi bragi's Avatar
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    Quote Originally Posted by 0_emissions :=)
    I currently sit in the $28,000 range. With all my bills right now, i'm looking at about $700/month in expenses. I probably could drive if I wanted to, but even for a beater I bet it would cost me at least 100+ per month, and that's just making 1-2 trips per month for the groceries, with insurance at $50-70. Plus, my moral conscience would hate me for it.
    I used to drive a beater, a real piece of junk, and it was still costing me over $300.00/month. Even seemingly cheap cars will drain your account pretty significantly if you fail to pay attention. (Of course, the money I save by going carless is being frittered away on bike stuff, hours spent in coffee shops, going to pubs to listen to music, and very foolishly buying a sailboat, but at least I'm now able to do these things without going into debt.)
    If you're not part of the solution, you're part of the precipitate.

  9. #9
    Senior Member Wogster's Avatar
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    Quote Originally Posted by Eatadonut
    A 1992 Toyota Tercel will run you about $2000 in good condition, and probably cost you a quart of oil every month ($48/yr). $3/gal for gas, you get ~30mpg at the low end. So you drive 20 miles a day, that's ~7500 miles a year. ~250 gallons of gasoline, that's $750.

    So if I bought a new used tercel every year, I'd spend $2800 annually to have a car. If I kept that tercel for 4 or 5 years, my annual costs would be lower.

    So now that's out there, what are you spending the rest of your $29,200 on?

    EDIT: insurance, of course. Call it $75/mo, so an extra $800 a year. Now you only have $28,400.
    You forgot repairs, a 1992 car is now 14 years old, and will need repairs, I don't think I ever had a car repair that didn't cost at least $500 . So considering 6 repair jobs a year, that's another $3,000 and you thought old cars were cheaper.

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    Quote Originally Posted by bragi
    I used to drive a beater, a real piece of junk, and it was still costing me over $300.00/month. Even seemingly cheap cars will drain your account pretty significantly if you fail to pay attention. (Of course, the money I save by going carless is being frittered away on bike stuff, hours spent in coffee shops, going to pubs to listen to music, and very foolishly buying a sailboat, but at least I'm now able to do these things without going into debt.)
    Heh, You seem to be in the same 'boat' as me I spend a lot of money as well, on the coffees(cadence!!), lots of bike stuff, plus I go to a lot of shows & concerts, don't have the boat tho. Still, i'm much happier this way, i'm healthier, skinnier, sleep better...one way or the other, your account's gonna get drained.
    yep.

  11. #11
    You know you want to. Eatadonut's Avatar
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    Quote Originally Posted by Wogsterca
    You forgot repairs, a 1992 car is now 14 years old, and will need repairs, I don't think I ever had a car repair that didn't cost at least $500 . So considering 6 repair jobs a year, that's another $3,000 and you thought old cars were cheaper.
    6 repair jobs a year? $500 a repair? Maybe you need to switch to more reliable, less exotic cars.

    I based all my information on my roommate. I specifically mentioned a 1992 tercel for a reason.

    He recharges the freon (yes, freon, his parents bought a big tank of it before it was illegal to sell) every couple years, and puts in a quart of oil every month. The last "repair" work he did was to replace his stereo faceplate.
    Weather today: Hot. Humid. Potholes.

  12. #12
    Lurker extraordinaire Golf XRay Tango's Avatar
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    It depends totally on where you live. In Ontario, nobody gets away with less than $1000/yr for insurance, and it frequently runs up to $5000, especially if you are under 25.

    When I started out on my own (about 15 years ago) I was making $28,000/yr. My take-home was $860 biweekly, so about $1900/month. I spent $500/month renting a room, $300/month for my $3000 car, and $500/month on my insurance. I'm not sure about repairs, but it was probably a few thousand a year.

    I was barely hanging on every month. I can't believe I got my student loans paid off with that much money draining away.

    I only wish I had thought about being car-free back then.

  13. #13
    Senior Member Ziemas's Avatar
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    I spent 2200 euro on my car three years ago. Registration is 70 euro a year and insurance is 60 euro a year. I fill up the tank about once every three months which costs about 35 euro. Throw in another 100 euro for maintence and the total so for has been a little over 1000 euro a year, or 84 euro a month. The monthly sum will go down the longer I own the car. It is possible to have a low cost car for the times when you NEED one.

  14. #14
    Chairman of the Bored catatonic's Avatar
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    Lots of things bleed people to death.

    Heck, go look at razor cartridges for a prime example of expensive...Those Fusion cartridges are like $4 each! EACH! That's ridiculous. Someone could get a double-edge "safety" razor or a straight razor, and save quite a bit of cash compared to these cartridges, and get just as good of a shave, if not better.

    Same goes for our food...we could save quite a bit of cash by ignoring coupons. Coupons are a great marketing ploy: Make people buy more because they "saved money on it", regardless of if they really wanted it in the first place. Pretty much it's a ploy that pulls on a person's impulse control. Just go buy what you want, and don't buy any more perishable food than you need. Keep your pantry relatively bare as well. There is no such thing as saving money by spending more.

    Reducing gas and electricity usage is a must. Keep in mind a TV consumes tremendous levels of power. And many of those Plasma TVs are actually worse than most CRT TVs in power consumption once you get past around 30". Consider floursecent bulbs in as many places as possible, or even LED cluster bulbs if you can afford them (less replacing, and lower power consumption compared to a regular bulb, plus less heat output). LED bulbs are best used in places where the lights will be used constantly and for extended durations, like living room lights.

    Fixing the seals in your windows and doors is a fantastic way to shave a large amount of cash from your electricity bill. If you can see light through the seal, you are losing money in the form or heating/cooling through it.

    TURN OFF YOUR COMPUTER WHEN IT'S NOT IN USE! A "gaming" desktop computer can eat up as much as $30 in power a month if left idle....more if you are running one of those folding programs on it. A more normal desktop computer could put $10-20 per month in electricity costs. So be sure to power it off when it's not in use. This goes for printers/monitors/computer speakers/etc.
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  15. #15
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    I agree with everything you say EXCEPT this bit...
    Quote Originally Posted by catatonic
    Same goes for our food...we could save quite a bit of cash by ignoring coupons. Coupons are a great marketing ploy: Make people buy more because they "saved money on it", regardless of if they really wanted it in the first place. Pretty much it's a ploy that pulls on a person's impulse control. Just go buy what you want, and don't buy any more perishable food than you need. Keep your pantry relatively bare as well. There is no such thing as saving money by spending more.
    This can save you money as long as you are organised - we have a monthly shopping budget and plan what meals we are going to have. If you do this then you can take advantage of buying in bulk for useful items that you will use. Check what products can be frozen for later use.
    Where people go wrong is trying to 'buy up' in order to save money, which results in exactly what you describe.

  16. #16
    Chairman of the Bored catatonic's Avatar
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    I agree, but I usually find that instead of it being used within the month, it usually sits "out of sight, out of mind" in the freezer. So after many failed attempts at organizing my meals and freezing stuff, I just said to heck with it and just buy what I will use for that week.

    It also keeps the fridge nice and neat, which is a great bonus. The only things that stay in there for any duration are condiments and beer (I usually have one beer a week, so a sixer lasts me a while).
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    Quote Originally Posted by Eatadonut
    Making statements like that doesn't make you more credible with the driving crowd, no matter the response you get here preaching to the choir.

    What kind of car are you theoretically driving that you can't afford to put any money in savings while making 32k a year?
    You might have a point there. At the time, my rent, utilities, food, cell phone, student loans and credit cards alone were about $1,100.00 - $1,200.00 dollars per month. That would leave me about $100.00 dollars per week or less for descretionary income. In other words, I had about the same amount of spendable income of a high school teenager living at home. The 32K salary may go a long way in Idaho, but you'll struggle big time living in any major city. I guess you'll eventually become more responsible with money as you get older but the real savings didn't occur until I eliminated my second biggest expense. The motorcar.

  18. #18
    The Rock Cycle eofelis's Avatar
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    Quote Originally Posted by Wogsterca
    You forgot repairs, a 1992 car is now 14 years old, and will need repairs, I don't think I ever had a car repair that didn't cost at least $500 . So considering 6 repair jobs a year, that's another $3,000 and you thought old cars were cheaper.

    I have a 1991 Subaru Legacy 4WD wagon with 160K on it. Bought it in 1999 for $5000 cash. When I got it I put ~$500 into it for some repairs. Two years ago I spent $1000 for struts and tires. Since then it has just been oil changes and routine maintenance. Insurance is $300/yr. I drive it once or twice a week. It looks good and is still reliable enough for a road trip.

    When this car goes away I'm not sure what I will do. I certainly won't take on payments for another one. If I decide I need another car I'd wait til I could pay for one in full.
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  19. #19
    The Rock Cycle eofelis's Avatar
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    Quote Originally Posted by Eatadonut

    What kind of car are you theoretically driving that you can't afford to put any money in savings while making 32k a year?
    32k a year would be a lot of money for me! I could work a couple years and then take a couple years off. I've never made more than $16k/yr in my life (according to the SS statement I just got.) I've been living on less than $10k (taxable) for several years now as I've been a 30-something f/t college student. My tuition is paid with Pell grants and scholarships at a low-cost state college. I have few bills otherwise: rent, phone (no cell phone), electric bill. These are shared with bf I live with. Otherwise there are groceries and anything else we want to buy (mostly bike stuff). No other debts otherwise. We do have money in savings too. We don't feel deprived. My bf has a 1994 Toyota truck that is a similiar situation to my Subaru described above.
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  20. #20
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    Quote Originally Posted by Eatadonut
    So if I bought a new used tercel every year, I'd spend $2800 annually to have a car. If I kept that tercel for 4 or 5 years, my annual costs would be lower.

    So now that's out there, what are you spending the rest of your $29,200 on?

    EDIT: insurance, of course. Call it $75/mo, so an extra $800 a year. Now you only have $28,400.
    Wait a second. A 32K salary is about $1,500.00 dollars a month net income (providing you're contributing to a 401K as you should be). Rent alone for a one room apartment can set you back about $1200- $900 USD in the New York Metro. I suspect this is the case in many cities but this leaves you about $500-$700 (or less) dollars a month to play with. You now take this money and pay off your credit cards, student loans, food, utilites, cable bill, cell phone bill, lunch and what are you left with? You haven't purchased any clothing, vacations, gifts or how about dating or just going out with the guys! If you have to spend a significant portion of this $500-$700 on a vehicle, now you're really broke!

    Saving $3,500.00 hundred dollars a year for a car was a lot of money for me back then and still is! That's what you have to make (pretax) in order to spend $2,800.00 dollars on a used car. It would take about 5 months of saving every penny I had to come up with that kind of money.
    Last edited by Dahon.Steve; 08-21-06 at 07:28 AM.

  21. #21
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    Quote Originally Posted by Tightwad
    Reams of money saving tips to read on this site..........

    http://www.stretcher.com/index.cfm

    The topical index is HUGE!!

    (removed my OP as it was.....well....dumb. )
    Very good website. Thanks

  22. #22
    Formerly Known as Newbie Juha's Avatar
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    Quote Originally Posted by catatonic
    Lots of things bleed people to death...
    Consider floursecent bulbs in as many places as possible, or even LED cluster bulbs if you can afford them (less replacing, and lower power consumption compared to a regular bulb, plus less heat output). LED bulbs are best used in places where the lights will be used constantly and for extended durations, like living room lights.
    This is assuming you have no use for the extra heat generated by less effective bulbs (you talk about heating later in your post). My house heating is done with electricity, and it is on 24/7 about 8 months per year. I don't need it in the summer, so then any extra heat is wasted. But I don't have much use for lamps in the summer anyway, as there's usually more than enough natural light. I still use "energy-saving" bulbs, as they are more durable and work better in outdoor lights, for example. But energy-wise they're not that much cheaper for me.

    --J
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  23. #23
    Dare to be weird!
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    It's true that you can help heat your house by running inefficient indoor appliances. It's the same cost as electric resistance heating. It's about triple the cost of operating a heat pump. It's more expensive than gas heat, too (I don't know by how much though).

    Compact fluorescents work well for me. It's hot nine months of the year where I live. We get more than double the expected electricity savings for efficient appliances. That's because any wasted power indoors also has to be pumped out by air conditioning.

    When I used incandescent lights, I tended to use the 130V "long life" bulbs. They are even more energy inefficient than regular incandescents. I think people using air conditioning who change their whole house from 130V bulbs to CF will be surprised at the immediate electricity savings.

  24. #24
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    Quote Originally Posted by Tightwad
    Reams of money saving tips to read on this site..........

    http://www.stretcher.com/index.cfm

    The topical index is HUGE!!

    (removed my OP as it was.....well....dumb. )
    I pulled this "money saving" idea from that website in an article about car options worth having:

    "Cooled and heated cup holders:
    Now here's an option we all can appreciate. In the all-new 2007 Chrysler Sebring sedan, the front cup holders can be cooled or heated to handle whatever drinks are on board. No word on the price yet, but it's likely to be a big hit and will quickly become a feature on other vehicles."

    My idea of stretching my dollars must be different from theirs.

  25. #25
    Humvee of bikes =Worksman Nightshade's Avatar
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    "Moneyless living" anyone???

    http://www.zenzibar.com/Articles/moneyless.htm
    My preferred bicycle brand is.......WORKSMAN CYCLES
    I dislike clipless pedals on any city bike since I feel they are unsafe.

    Originally Posted by krazygluon
    Steel: nearly a thousand years of metallurgical development
    Aluminum: barely a hundred, which one would you rather have under your butt at 30mph?

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