number six: be sentimental

My friends know that I’m a big time suck. They also know that Marvin passed away in 2009 and they can probably guess that the new toaster is no where near as good. I confess that Marvin is still in the garage because I can’t bear to throw him out, but he’s enjoying his new life as a home for spiders.

The thing about Marvin is that he was a gift from someone awesome. From someone who is super considerate and noticed me smiling the first time I laid eyes on that darn toaster. From someone who knows that I’m not a morning person and that I had just moved into a new house and that my life was kinda upside down at that point. So it’s not Marvin per se…

What’s my point? Oh, ya. You can save yourself a heck of a lot of money by obtaining things that mean something to you in the first place. You like them more. They make you happy. They aren’t easily replaced by  new and shiny. Which is why I still ride the bike bought in 1989 with money left to me by my grandfather. And put my clothes in a dresser bought by my mom at a garage sale when she was pregnant with me. Saving myself $800 to $1000 just by being attached to those two items.

So embrace those perfectly worn in jeans! Love those boots that have stomped you all over town! Put cookies in the cookie jar you grew up with! Don’t wish you had something better…. there is nothing better than comfy jeans and fond memories.

(To clarify, not advocating hoarding. Marvin aside, when things have come to their natural ends I do replace them if they can’t be repurposed. I plan to fill my house with cats when I’m a crazy old lady, not a bunch of junk!)

a little something called ‘willpower’

There was a great interview on Spark today with Kelly McGonigal, the author of The Willpower Instinct. The main point of the interview, since Spark is a tech show, was how to combat those addictions to digital technology but she made some points that are relevant to pretty much every situation.

First, willpower isn’t just mental:

[4:04] And it turns out that willpower is actually a lot like the stress response in that it unleashes a set of coordinated changes in your body that are meant to help you deal with a new kind of threat, and that threat is something that is more internal. A desire, or a distraction, or an impulse that somehow your brain recognizes is counterproductive or destructive to your goals. And so rather than preparing you to fight or flee with this turning on of the energy and priming you to act, the willpower response actually slows you down.

Second, her suggestions for enhancing willpower were surprisingly simple (for the most part):

  1. Getting enough sleep (more than 6 hours per night).
  2. Meditation, as little as 10 minutes a day.
  3. Getting physical exercise.
  4. Taking small steps towards your goal makes it easier to take on the next big change.
  5. Thinking about what we really want (and stop making it a test of whether you’re a good person or not).
  6. Slowing down and pay attention.

Of course, you first need to willpower to do this stuff! I could really use some extra willpower these days. Not with frugal livin’ but with buckling down to school. Will get right on that thesis proposal as soon as I’m done reading her book….

My one peeve with the interview is Ms. McGonigal’s unrelenting uptalk. I know that’s the thing these days but it’s sooooo annoying?

number seven: be an eco-freak

In honour of Earth Day, I’m skipping ahead to number seven. Ever notice that a lot of stuff that’s good for the environment seems to costs a fortune? Installing solar panels? Expensive. Buying a hybrid or electric car? Expensive. Buying organic food or clothing generally costs more.

But on the other side, there are a whole bunch of things you can do that not only save resources, they also save money. Here are a few ideas that cost absolutely nothing:

  1. If it’s yellow, let it mellow. I know some people think this is really gross, but we cut 1/5 off our water bill just by selective flushing.
  2. Shorter showers. Yep, it is possible. And use the pause button on your shower head if you have one.
  3. Turn down the thermostat and put on a sweater.
  4. Or conversely, turn off the air conditioning and take off some clothes!
  5. Hang laundry on the line to dry.
  6. Some people are freegans. I am not. But I have joined the local Fruit Share. For a bit of my time, I get fresh local fruit for free.
  7. Compost!
  8. Beware of energy vampires. Unplug or use a power bar that can be turned off.

And a few more that might cost you a bit in the beginning:

  1. Plant a vegetable garden. Will save you money on fresh produce as well as save the fossil fuel that would be needed to get those Gala apples from New Zealand to your supermarket (unless you live in New Zealand in which case change that to “from British Columbia to your supermarket”).
  2. Use rain barrels for watering. These can be expensive to buy, but the city where I live subsidizes them so they are quite affordable.
  3. Transport yourself actively. There may be some start-up costs if you don’t have a bike or good walking shoes, but you will make it up quickly in gas savings. Heck, this might save you the cost of a gym membership too.

Any other ideas?

digital cash

Oddly, just a couple of days after posting on the benefits of using cash rather than debit or credit cards, The Current aired a segment on the rise of digital cash.

Privacy, government control, security, hackers and cyber-crime were discussed as the biggest barriers to the widespread use of digital cash and I can see that they are real issues. Also briefly mentioned were the elderly or those who are not tech savvy. And of course there will always be the stupid human error stuff that happens, like going swimming in the ocean with your cell phone in your pocket and not being able to catch the bus home from the beach because your chip is now swimming in brine.

What only received a whiff of a mention by the host and was not at all addressed by the people she was interviewing was the affordability of the technology for using digital cash. Here’s an overview of the bits that contributed to the furrows between my brows:

[4:18] The total social cost of cash is really significant because it’s not just the cost of going to the ATM and getting money now, it’s the cost of the security trucks and the armed guards and the money that gets lost and stolen and all of those other things. But there’s also a particular problem with the way the costs of cash are distributed. You know, if you’re poor, if you’re trapped in a cash economy, which is not true for many people in Canada, then the costs fall disproportionately on you. So it’s two problems really, it’s the high cost and it’s the way that cost is distributed.

Huh? This confuses me. I’m not sure how being poor and operating in a cash economy means that the costs of cash fall more heavily on you. What about all the debit fees and the incredibly high interest rates on credit cards? Or the cost of owning a smart phone or tablet?

[7:02] Well technically, the most cashless country in the world, actually in more way than one I suppose, is actually Iceland. Something over 90% of all retail transactions in Iceland are already non-cash. And then you have other Nordic, you know, Norway is up at the sort of 70% level.

To clarify, this includes all cashless transactions not just the digital cash as it is being talked about in the interview. So, debit and credit card as well as chips. Iceland, Norway and the other Nordic countries have large middle classes and the proportion of the very rich and very poor are relatively low. 21.5% of Canadians and 25.8% of Americans are considered poor or near-poor compared to 14% of Norwegians. These figures are from 2004 so it’s probably that the percentages would be higher now for Canada and the U.S. but I’m not sure about Norway (Source LIS Data Centre). I guess my point is that I worry that the large numbers of people in North America who are poor or struggling financially will not be able to afford to keep up with the technology required to operate in a digital cash world.

[11:00] I think in the medium term you’re more likely to see a sort of digital divide opening up where, you know, middle class persons such as you and I will never see cash again and couldn’t care less about it. We’ll use our mobile phones by and large to buy and sell most things. And, you know, some people will want to hang onto cash, drug dealers possibly, prostitutes, that kind of thing and there’ll be a kind of … polite society won’t use it but other people will.

This is exactly my concern. That people who are already marginalized will be pushed even further down. I don’t have a smart phone (hell, I don’t even have a cell phone), a tablet or any of those other toys that are beyond my means right now. I could have them but I would either have to go into debt to get them or chose them over other things. And I’m no where near true poverty. What about all the people who are? Screw ’em? They’re probably just drug dealers and prostitutes anyway?

This is not an anti-digital cash rant. I’m not a luddite. I like technology and think the internet is a freakin’ amazing invention. I often find myself in situations where a cell phone would come in handy and I have to talk myself out of wanting one. Just wish this program had talked about some of the social issues beyond privacy.

And speaking of technology…

I’m a couple years younger than Louis C.K., which is probably why I relate to this video so much. Including it just because it’s funny and quite frankly this post has been a bit of a downer.

number two: operate on a cash only basis

This is a recent addition to my bag of money saving tricks. In the fall, I switched from a bank account with a $12 monthly fee to a student account that had no monthly fee. The catch being that you could only make 25 transactions out of your account per month, and every transaction over that had a stiff fee attached. The first month my fees came to $19. Grrrr! But now I’m much more careful. I pay my bills (6 transactions) and then take out $100 at a time and use cash for purchases.

The $100 does not stay in my wallet. I dole out smaller amounts based on what I think I’ll need for the next few days, such as a bus pass or groceries. At first I thought this would suck (not sure why) and I felt like this cash only system was being imposed on me by the stupid bank (again, not sure why) but it has turned out to be vastly beneficial for three reasons:

  1. I don’t pay any monthly banking fees because it limits my total number of transactions (which was the point in the first place, so yay, it’s working!);
  2. Debit money is fake and cash money is real, at least mentally. With cash, I can physically see my little pile of twenties getting smaller and this truly does make me think more about what I’m spending my money on; and
  3. My account automatically comes with $500 overdraft which I can’t get rid of. It is unbelievably easy to dip into it when using debit. With cash, I monitor my account more closely and make decisions rather than inserting my chip willy-nilly and realizing after the fact that I’m in debt.

Absolutely plan to stick with this system once I’m employed and on Easier Street again.

An added bonus? I don’t have to worry as much about stuff like this.

number one: pay your bills first

Personal finance websites say you should pay yourself first. So you can, like, save money or something. This probably is good advice when you are not living hand-to-mouth.

For me, the best thing to do is not get behind. Every second Friday, I log into my bank account, pay my bills, make the minimum payment on my student line of credit and send the love of my life my part of the mortgage. The bills are mostly on monthly plans so I pay the same amount every two weeks. For example, our internet / phone bill is $90 per month so I pay $45 every two weeks. Because there are 26 pay periods in a year, this puts me ahead a bit so I can skip paying bills at Christmas. I find this much more manageable than trying to pay them all in one pay period and then make the next paycheque stretch for four weeks.

Not worrying about having the power cut off or feeling like you are drowning in bills is a serious stress reducer.