"Normal and Average"
I had a reporter from CBS News call me today asking how average people who are living paycheck to paycheck can get a savings going.
I told her that one of the first things they can do is stop eating out. She later told me "well, you hear the stop eating out thing all the time. I want to know what normal, average people can do to save money who are living paycheck to paycheck ."
The thing is most "normal and average" middle class Americans who are having living to paycheck to paycheck aren't doing so because of something unpreventable like medical costs. They are doing it because they are spending more than they earn on stuff they don't need.
What are some of the areas?
Eating out! Yes, families do spend literally THOUSANDS of dollars a year eating out. Add it up you will be shocked.
Too much stuff.- Stop shopping. I spend $250 a year on clothes for our family. We don't need that many clothes and I buy it mostly at thrift stores and yard sales. Stop shopping just for something to do.
Too many activities- It's not abnormal now to have kids in 2 or 3 activities a week each. That's crazy! Let them do ONE and one only. You will save money on the fees, gas driving there and eating out because you "don't have time". The "average" family will spend $300-$500 a month on activities for one child.
Groceries- You buy a bunch of junk food you don't need. I spend $250-$300 a month. The "average" family spends $500-$900 a month.
Cars- Stop buying new cars you can't afford. Why are you buying a car for $30,000 when you earn that amount in a year? Add up the interest and extra insurance and taxes. It does up add up to that much.
"Treats"- You don't need a Starbucks or other "treat" every day.
Housing- Why do you have a 3000 sq. ft. house for a family of 4? Get something smaller that you can afford and doesn't cost as much to heat.
Now, you may not be in this boat and if you're not then congratulations but a LOT of middle class paycheck to paycheck Americans are. It's time to stop whining about the "bad economy" and start taking some responsibility for your finances.
Tawra (who is off the soapbox now. :-)
I told her that one of the first things they can do is stop eating out. She later told me "well, you hear the stop eating out thing all the time. I want to know what normal, average people can do to save money who are living paycheck to paycheck ."
The thing is most "normal and average" middle class Americans who are having living to paycheck to paycheck aren't doing so because of something unpreventable like medical costs. They are doing it because they are spending more than they earn on stuff they don't need.
What are some of the areas?
Eating out! Yes, families do spend literally THOUSANDS of dollars a year eating out. Add it up you will be shocked.
Too much stuff.- Stop shopping. I spend $250 a year on clothes for our family. We don't need that many clothes and I buy it mostly at thrift stores and yard sales. Stop shopping just for something to do.
Too many activities- It's not abnormal now to have kids in 2 or 3 activities a week each. That's crazy! Let them do ONE and one only. You will save money on the fees, gas driving there and eating out because you "don't have time". The "average" family will spend $300-$500 a month on activities for one child.
Groceries- You buy a bunch of junk food you don't need. I spend $250-$300 a month. The "average" family spends $500-$900 a month.
Cars- Stop buying new cars you can't afford. Why are you buying a car for $30,000 when you earn that amount in a year? Add up the interest and extra insurance and taxes. It does up add up to that much.
"Treats"- You don't need a Starbucks or other "treat" every day.
Housing- Why do you have a 3000 sq. ft. house for a family of 4? Get something smaller that you can afford and doesn't cost as much to heat.
Now, you may not be in this boat and if you're not then congratulations but a LOT of middle class paycheck to paycheck Americans are. It's time to stop whining about the "bad economy" and start taking some responsibility for your finances.
Tawra (who is off the soapbox now. :-)
posted by Tawra Jean at 12:38 PM
17 Comments:
Tawra, we LIKE what you call your "soapbox" in this post!!!
That's because we are paying off major--and I do mean MAJOR--debt by doing all the things you're describing here to cut our cost of living. And it WORKS!!!
And, you know, we don't miss all that other stuff hardly at all....things like eating out and having the latest clothing styles have faded in their importance by FAR to getting that debt paid down...PLUS enjoying much more time at home, together as a family, and with friends, and volunteering moreat church and in the community, etc.
Our debtload by the way, is due to unexpected medical bills and a couple of other things out of our control, just like you said. We also drive 11-year-old cars that we bought (very!) used, etc., etc.
Thank you again for all the wonderful stuff we get from your blog and Website!!!
In Indiana,
Kimberly
Well hot diggity! I can also attest to what it means to choose people, relationships, and security over money! I am appalled at the number of people I personally know who "make" more than we do, yet struggle financially/emotionally to the point of depression (compounded by avoidance of addressing the real issues of priorities and self control).
I sum it up this way...you can either try to fill a never ending hole (in yourself, your relationships, you name it) by purchasing things and stuff, or you can "stock a pantry" that provides for a clearview of what is most valuable in your life (your relationships, yourself, your family)and gives you a sense of security and a great base from which to move forward.
In peace and love,
NT
I like your soapbox too. Your ideas are all absolutely true and I am debt free and have been for 3 years because of them. Love how the reporter discounted it when you said the most crucial thing to stop doing! Thank you for that.
Dear Tawra on the Soapbox:
Everything you say is true. My daughter is allowed to have one activity - she does jazz dance. Some of her friends' schedules are crazy -- gymnastics, cheerleading, etc. and then the moms wonder why their kids are up late at night trying to complete school assignments, to say nothing of the cost. Let kids be kids!
Also, I have never made a purchase at a Starbuck's. What a rip off that place is.
My one weakness is that I love to eat out on weekends. But, I don't smoke or drink, so I guess eating out is my one vice. If I do go shopping, my favorite store in the mall is Barnes and Noble --- that is more fun than clothes shopping.
Hope you are feeling better.
Angela
The word is "accountability!" Everything you said is about being responsible and accountable for our decisions. Somewhere in the American culture, we went from being accountable to feeling entitled. We have been provided for far beyond our eyes can see. Being frugal or resourceful isn't hard. It is a choice. Thank you for encouraging the group! Robin in CA
Tawra, I agree so much!
I have learned so much from reading your column and book. Loss leaders (at the chain grocery stores) were something I had learned in college, but had totally forgotten until I started reading your blog. I can say that you totally changed my way of shopping. I was a snob about Aldi's. I would buy what ever brand name products they had but would not use their brand. Well forget that-now we buy a good portion of our groceries at Aldi's. Their graham crackers and animal crackers are positively ADDICTIVE!! Their canned veggies are the same quality of those brand names that I bought for years. We do still do more take out than we should due to having bad Fibromyalgia days, but I have been trying to keep more of the frozen selections from Aldi's in the freezer for those times. They do offer the family size Stauffers meals and some really good frozen pizza's too. Keep up the good work!
Love your soapbox. I just wish that the CBS reporter would have quoted all of what you said. I doubt the reporter even understood the financial significance of not eating out. Keep up the good work. Bellen
You just stay right up there on that soap box, TJ! That is the reason your family is so well known now! You and Jill practice what you preach and are the success stories to living frugally. My family has learned so much from your family and are better for it. Keep up the good work and I'll keep recommending you to everyone I know!
Tawra, the problem with what you told the reporter is that people don't want to stop eating out and frankly, many people see it as a necessity. that is why she wanted something different. People aren't willing to give it up. you are right though!
I love to eat out, at least I used. Having 4 kids and 1 with severe food allergies has totally limited our eating out. It has been great for our budget and I really don't miss it often.
Well, I agree with what you said. I do think that something the 'average' pay day to pay day person can do too is to let the bank take a small amout of each pay check and put it into a savings account. Just 1% of your check..say $10.00 is enough to start. I know it will take time but time is something we have more of than money...(most of the time anyway)
We eat out once a week. It is our 'date night' with friends..we go to our favorite Mexican food joint and then come back to the house and play cards...that is our big entertainment for the week..we do not rent movies, we do not go to movies, and we do not shop for the 'fun' of it. I have not been in a mall is 10 years. (I am not kidding) I shop for things ONLY when I have a real NEED not just a want. Big difference..yes, I have kids too. I shop for their needs at thrift shops, garage sales, and the usual Wal*Mart and Target. They do not lack for anything believe me...
Thanks for all you do. I enjoy the newsletters a lot. Take care of yourself.
Tawra, I like how you put it all plain and simple!
People have to learn to break certain patterns and habits, and I think the reporter just wanted a magic wand. So much of our busy-busy-busy stuff is automatic, it's not important.
The eating out advice alone is a huge money saver.
Speaking of smaller houses, check out the Tumbleweed portable house idea, and other small house movement stuff. I think you would get a kick out of the idea.
you are sooo right tawra... yep, if people would just stop doing the things that are costing lots of money, then they would have more money to use towards saving or paying down that debt!...
i love to eat out (who doesnt?)... but bc i am soooo frugal, i dont want to spend the money... not unless i go to a buffet and pay lunch prices when its close to the dinner time price change... or to olive garden (all you can eat soup and salad... and yes, i do bring home a doggie bag!)... and also on tuesday's, at cracker barrel (not sure if you have one of those but the food is home cooking and well, its awesome!)... on tuesday's they have "butter baked chicken"... and well, its 1/2 (yes 1/2!) a chicken and 2 sides!!!... and biscuits and/or corn muffins for one low price.. well, i normally bring 1/2 home to my husband...
but we only do this once in a while... and only as a treat!..
you are sooo right about the kids having too many after school things... no wonder they are sooo tired in the am ... my kids didnt have any of this when they were growing up... bc well, we couldnt afford it.. oh we did try to get our son into scouting... it was for like $10 to sign up but then you had to pay for the uniforms and the other stuff and the camping and etc etc etc... dont get me wrong, scouting is wonderful but we just couldnt afford it and not only that, we work as paper carriers and well, we couldnt take off at any time... that was how we made our money!...
did they suffer?.. nope ... and well, they worked with us from the time they were young, and yes we gave them an allowance and if they wanted to do something extra, and if it wasnt too much, then we paid for 1/2 of it... it gave them a responsibility... my dh and i came from very very poor families and well, our parents never gave us anything extra except what they could give us, food, shelter, love, their time, you know the basic needs...
you keep standing on that soap box tawra.. you, mike and jill have helped not only me but countless of other people and for that i am truly thankful... i thank GOD everyday that i found your website!!!...
i am constantly recommending your website to everyone i meet online and with my friends and family...
thank you sooo very much for all you do for all of us..
rose wilson..
Bravo Tawra!! The eating out thing is huge. My family used to go out for a big dinner every Sunday. We decided to cut back to once every other month and the savings was huge. We next tackled the fast food and lunches out and that made a big difference too. People really are eating their money!
On a somewhat less serious note, my other pet peeve is that home decorating channel! I found the more I watched that channel, the less content I was with my own home, which of course is the whole point of those shows. I think they have convinced America that life is not worth living without a huge house, granite or marble countertops and of course stainless steel appliances and a flat-screen TV. Almost all those shows are surrounded by commercials for mortgage companies, banks and those big box home stores. Well now the chickens are coming home to roost!
Oops, I guess I drug out my soapbox, too!
Carol
We make a large pot of soup and it lasts us for an entire week. We never eat out.
Joel and Laurie
Carol I am so glad you said that! I get so mad when i see those home makeover shows too. I am not willing to put myself deep in debt for something as unimportant in the grand scheme of things as home decor. Our home is ours, no mortgage, we own it free and clear. My vintage original 1962 kitchen is so out it's in. I love it and will never change it.
Kathy
Hi Tawra,
You are so right about the eating out and "too many activities for kids". It's a real "blow up"budget.
Kids need to be kids and have some free time to just "do nothing". They don't need to be constantly involved in "boxed" activities.
marie
I definately know the eating out thing is a major factor, it is so easy to "forget" about the small purchases until you see the credit card bill and it will really open your eyes to what you spend. Even shopping, I do shop at Goodwill but I also catch some really great end of season sales that are as good as something from Goodwill at times. It pays to look around and know what exactly it is you really need for your family before mindlessly going to the stotres and never wait until you have to have something if you don't have to. There's nothing worse than shopping when you are deperate to find anything that looks decent or acceptable for an important event/special occasion. Tawra, I went from having awful credit to being up to 895 and climbing. Thank you ever so much for your sound advice and just being real. Tami
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