These Hard Economic Times - February 17, 2009
Dear Readers,
In today's newsletter, we take a closer look at "these hard economic times". Hopefully today's newsletter will give you a different perspective and a few suggestions to improve your own financial situation.
This week's Sale of the Week is our "Saving With Kids" 13 E-book package. If you want to teach your kids to be responsible with money, get them to do their chores and finally get those toys organized, this e-book set will give you a boost! It's half off this week and includes a bonus e-book that our son BJ wrote, showing a kid's perspective on saving money. Learn more here!
We need your creative idea! We are putting together an e-book about how we live with chronic illness and how we manage to save even when we're sick. We haven't come up with a catchy title that we like and are asking our readers to give us suggestions. After all the suggestions are in, we'll have a drawing and give the winner a free copy of Dining On A Dime, either the print book (US Only) or e-book. Give us your suggestion here.
Have a great week!
-Tawra
www.LivingOnADime.com
These Hard Economic Times
I keep asking myself, "Has the world gone crazy?" What are people talking about when they say "these hard economic times?" I am so confused because I hear so many people say these are such hard economic times but, at the same time, what I see happening with my own eyes and hearing with my ears is a totally different story.
Let me give you some examples what I mean. Are these examples of hard economic times?
- Last year we spent more at Christmas and all year shopping than the year before.
- Americans spend 500 million dollars a year to have their teeth whitened -- not cleaned, just whitened to look nice.
- A single mom on welfare spends $350 on a cell phone-- not on the calls, just the cell phone.
- On a home shopping show they were selling American Girl dolls for $135. The woman selling it said "Kit is our most popular doll."
The other woman said "That is probably because Kit represents the Depression Era and girls nowadays relate so well to that because they have to sacrifice and give up so many things in these hard economic times." They sold out of the doll. This meant several thousand of these poor little girls who have had to give up so much received a $135 doll for Christmas. What was it they had to sacrifice? Maybe it was the $25 outfits that went with the doll. (I have never paid $25 for an outfit for myself let alone for a doll!!) - A woman just lost one of her part time jobs. She was sobbing and crying because her family was going to have to sell their house, which they could no longer afford. For the past several years they have been making very good money but they have been spending it on everything including $150,000 for decorating their home, several trips a year for the whole family to travel across the country and to Canada for sports events their sons wanted to play in, buying a couple of new cars every year, eating out frequently and the so on.
Even after she lost her job they still took another cross country trip to go to a game. After coming totally unglued about the thought of having to sell the house she was asked if they might be able to save the house if they would cut back on their spending a little. Her reply was, "No way. I hate to scrimp and save and do without. I won't live like that." As my son in law loves to say "Allllrighty then..." - My brother just met a man who restores hot rods for a living. When asked if things are getting harder for him the man laughed and said "No, I'm doing better than I ever have and I need to hire someone to help me." My brother is now working for that man. He is getting paid to sand people's car engines so they will look pretty and smooth. People have so much money they can pay bunches to have their engines sanded? Go figure. For those of you who restore cars, don't yell at me! My dad has restored Model A and Model T cars for years, so I know all about car restoring.
- Here's my favorite: A sales person selling a $1500 piece of jewelry said, "We know things are so rough in these hard economic times so we have put this on 5 easy payments for you." They sold out of it. Do you know how contradictory that is? If things are so hard, what in the world are people doing buying $1500 pieces of jewelry, even on 5 easy payments?!?!
I don't have anything against people buying jewelry, dolls, cell phones or restoring hot rods. What I do have a problem with is people moaning and groaning about how hard these times are and then taking off to go shopping or play a game of golf.
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We get upset and angry about the government, big companies and their crazy spending but we need to stop pointing fingers and look at our own lives. Are they doing anything differently than the average American?
We may not have the opportunity to be foolish with millions or billions of dollars like them, but that doesn't matter. The point is that many of us are being just as foolish with what we have as they are. We are up to our eyeballs in debt just like they are and most of the time it's because we didn't think or care about how we were spending it. Then we want someone else to bail us out.
Yesterday, I heard a pastor, Bob Coy, talk about this same type of thing. He had some good points to make. He showed a web site called Global Rich List, where you can type in an income and it will tell you how rich you are compared to the rest of the world.
Here are some interesting stats from that site:
If you make $35,000 a year, you are in the top 4.62% richest people.
Here are some others:
$50,000 - Top 0.98%
$75,000 - Top 0.82%
$100,000 - Top 0.66%
It makes you stop and think. Are things really that bad? Two million children died last year because of lack of clean water and I sit here complaining because the price of gas is so high that I might not be able to take a vacation this year?
Yes, unemployment is up but look at it this way: over 92% of the people in the US have jobs. Many of those who don't have jobs aren't even looking for work. I know a lot of people who are 20 or 30 something and living at home and not bothering to find a job.
We need to change the way we look at things and stop parroting what everyone else says about "these hard economic times."
I'm not so naive as to miss the fact that financially things are getting out of control and will eventually bottom out, but that doesn't mean things are so hard yet that people should be carrying on the way they are. Instead of moaning, we need to fix things, starting in our own lives.
The pastor I mentioned earlier said if we have a friend who is deep in debt who says "let's go to the mall", as a good friend, you need to say no. Suggest that your friend come over to your place for coffee and a visit, helping her and yourself not to spend more. Start looking at what you are doing and how you can fix it.
We need to face the facts. A big part of our "hard economic times" is summed up in this wonderfully appropriate saying:
We buy things we really don't need
with money we really don't have
to impress people we really don't know.
Memorize that saying and the next time you go to buy anything stop and think, "Do I really need that?" Do you need to buy your kids the most expensive shoes? Do you need to get the most expensive car or would a two or three thousand dollar car get you by? What about those manicures and pedicures? How much do you spend on all the kids activities or on throwing that big football party and having the whole gang over?
I knew a man who lost his job and his wife worked at a very low paying job. He said he didn't care if he didn't have a job. He was still going to play golf every weekend (and he did). They are in a big financial mess now, but not because of "these hard economic times".
When considering buying something, ask yourself, "Do I really need it?" Do you have the money to buy it? If you have to borrow money for it, you don't have the money to buy it. It's that simple. If you need it, work hard and save and then get it.
Many of us think that waiting to buy until you actually have the money is impossible, but once we stop buying everything on credit, we free up all that money we were using to pay credit card bills, interest and fees. That money is then available to buy things we need or want.
Why do you buy the things you do? Do you do it to impress others? This is pride. I don't have room to go into detail in this article, but God hates pride as much or more as drugs, alcohol abuse or sexual immorality and so many of us suffer from pride. If you don't think you have a pride problem, consider whether or not you might say one of these these statements: "I would never allow my family to wear clothes from a garage sale." or "There is no way I will do without .......(fill in the blank)".
The Bible cautions us to watch the words we say. Don't just spout empty meaningless words like "in these hard economic times" just because the world is using them and don't use words like that as an excuse to justify why you don't have your life and finances together.
Actions do speak louder than words. Are your actions matching your words?
-Jill
posted by Michael Kellam at 10:01 AM
14 Comments:
Great article, Jill. Thank you for that. I always look forward to your email newsletter, but I think this was one of your best yet. God bless, Kari
Awesome! Well said and told the way it is:) Great Job. I'm going to link to this on my blog:)
Thanks!
Wow - great post - definitely one of your best. If this doesn't make people stop and think, nothing will! Thanks for the hard-hitting words.
Thank you for the validation...I was saying the exact same thing yesterday! A friend and I had noticed how packed the local shopping mall was on Valentine's Day. Restaurants were overflowing and florists were swamped. It didn't appear to me that people were too concerned with the economy! We are so spoiled in the United States. Most of us have no clue how to discern between what we want and what we actually need!
Very well said...I was thinking the same thing Lisa said too...my son that is 23 and I were out Sat Feb 14th and as were walking into the store he said I don't get it if a lot of people where without jobs how come the stores were pack out.
Amen!
Thank you...I am getting very tired of hearing how Americans who have been spending beyond their means are the reason we are in this crisis...yet those of us who have kept limits on spending over many years are now being punished. More of us should be following a frugal lifestyle! One can only imagine where the USA would be then! Thanks for a great article! :)
Awesome newsletter, I agree 100% My husband and I live on my disability check b/c where we live the construction business is not real good and that is what he does. He does odd jobs when he can. We spend alot of time at home. Or big expenditure is the internet and cable. Sadly this is our life but with my disabilities I am not able to do much else. We don't even own a car, we can not afford it.
Thanks again for all your advice
Tina
This article sums up pretty much the way I feel about the situation our country finds itself in right now. Wouldn't it be great if Americans believed that it was their PATRIOTIC duty to help get their country out of poverty by getting by on less? By not spending beyond their means? By having a food storage so that if crisis occurs, they don't need emergency food boxes or food stamps? By paying off depts, so that if unemployment occurs, they don't have to claim bankruptcy? By having an emergency account so that if a car breaks down or someone has to go the E.R. (in our case it was our beloved doggy, who got salmon poisoning), you don't have to put it on a credit card? Yes, imagine what this country would be like. I feel that change begins at home, that I need to clean up my own back yard before I go knocking on my neighbor's door. Right now, the best thing I can do for my country, I believe, is pay off my debts so I don't need to depend on government handouts if/when my DH loses his job. I'll get off my soapbox now.
Wow! Excellent post. And how true it is that most of the "hard economic times" could be avoided if we used common sense and learned to postpone gratification when the times were not so hard. I have a lot of sympathy for people who have lost their jobs through no fault of their own. But no job comes with a guarantee of permanent employment (except parenthood!) and we who have jobs need to remember that and plan our future accordingly. Better to do without a little when there is plenty than have to do without a lot when there is nothing. (okay, that made sense at some level when I first wrote it!) Anyway, one of your best articles, Jill. Thank you!
Thank you!
No big surprise there. It seems like most people that are always hitting hard times are spending their way there. Only they never seem to remember that. I think having enough money is more about action and how you live than about much you know or think you know about money. I love your articles. Thanks
I'm sitting here listening to the ridiculas presidential speech about how America needs to spend billions of dollars to get out of debt. Go figure!! I think you should do a massive email to all government representatives. Including the President!! They make things just so complicated!!!
Keep up the good work!
Thanks!!
Thank you for your encouragement! I love to read "Living on a Dime".
As a gift to you, I would like to share my story:
I think we could save about $1,000 a month if we really cut out every extra expense, said my husband. Do you want to try? The economic news is increasingly glum. He caught my attention!! Saving money, count me in!!
A plan was hatched. My husband and I would try an experiment for one month from Jan 12th to Feb 12th.
1) We would try to save $1,000 by spending money only on absolute necessities. (Eg: no dining out, movies, unnecessary trips, etc)
2) We would test our emergency food supply to see how well prepared we were.
History records the devastation to families that occurred during the great depression; job losses, home foreclosures, bank closures to name a few. We decided to pretend as if we had just experienced an overnight market crash just like the 1929 depression. We decided to live on what we had in our home. Our "little" experiment was to be a measure of how well prepared we are with stored food if/when things really get tough for us. Were we truly prepared for a national emergency with possible consequences to our personal finances? Could we make it with our stored food? Would we save enough money to make a difference in our life?
I think that I am thrifty and well prepared with extra food but time will tell. Several months ago, my husband and I had gone shopping and purchased canned fruits, veggies, meats and staples as a hedge against "hard times". I tried to gather a nice variety of foods because I had heard about food fatigue due to eating the same thing over and over. With this new one month plan, we would see if we were prepared.
I began to understand Living on a Dime admonitions about serving size and stretching meats into more servings.
We ended up eating quite well even though what we ate was mostly from cans with supplements from the freezer and home made summer jams and fruit. It was a sad day when, at the end of our first week, we ran out of fresh fruit. I really missed fresh fruit and veggies. I missed crunchy foods since most of our foods were canned. I made do with some dried banana chips but they were gone in a flash since I ate them every day. Crackers helped get the crunch going, too.
I really missed fresh milk. I kept putting off buying dried milk because I don’t normally use it and how I wish I hadn't. Eventually I opened a can of evaporated milk and used it on my oatmeal. It satisfied my craving. Usually I put applesauce on my oatmeal but that day I needed milk!! Later in the month we bought fresh milk and fresh veggies and fruit. We used it as a treat instead of going out to dinner or to the movies. Fresh fruit became a top priority since we were cutting out so many other things.
The most difficult part of the experiment was the psychological and emotional impact of "doing without". Feeling oppressed long-term was very wearing. I had to remind myself constantly (actually many times in a day) that I was a volunteer in this trial because everyday the financial news was so bad. Day after day the economic news was bleak! What if we HAVE to live like this very soon AND for a long period time? I decided not to volunteer for that experiment!! :)
It was fun and creative from the start. In the beginning I ate less and was not hungry. However, after the first week, the exercise became physically, mentally and emotionally stressful. Sometimes I was hungry for no apparent reason. I just felt deprived. I was tired due to having to think about absolutely everything; every task or decision individually measured to make sure I was making the best choice for our long term survival. Don’t waste, do it better, smarter. I learned a lot about myself and how to be strong physically by being prepared for the future.
There was a nutritional learning curve using all canned foods. When our diet seemed a bit heavy on the carbs, I added veggies. At other times our diet was light on fats or protein. I had to balance our diet with beans, rice and corn. We started eating lighter evening meals. Canned soups can have a lot of salt. I need to purchase low sodium the next time. I have adjusted our storage shopping list, and yes it includes powdered milk, dried fruit and vitamins.
At the end of our experiment we had saved about $ 1,000 extra. PTL We still had enough canned food to last for another 2 months plus. The freezer was almost empty. We may have had enough meat for 2 more weeks.
I also learned that God is my provider even in an experiment. He stretched our food to plenty. All month long, He sent wonderful little surprises our way. He sent fresh veggies, bread, pizza, movies, a tortilla press and much more through dear family, friends and Living on a Dime. At every step He said I love you and I will take care of you.
May God continue to bless you, blessing us,
Claudia Millerick
claudia.millerick@gmail.com
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