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Is Capitalism Compatible With Caring?

By Frugaling 6 Comments

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Google Campus Photo
Google is known for being one of the best places to work, with some of the happiest employees.

On the cost of caring

Each year, 217 million workdays are lost or less productive due to mental health concerns. Indirect mental health costs on companies are estimated at $59 billion. But some estimates put these costs as high as $80 to $100 billion. These staggering numbers often serve as motivators for human resources departments and corporations to take action and “solve” mental health crises.

For each specific diagnosis, the statistics vary widely. Researchers tend to look at indirect costs, direct health coverage costs, productivity disruptions, absenteeism, and failure to be mindful while on the job. One of the more common ones, depression, costs employers about $44 billion in lost productive time. Additionally, employees with depression miss about 4.8 days of work and 11.5 days of reduced productivity every 90 days.

Another frequent mental health concern in employees is anxiety. Symptoms of anxiety manifest in various ways, but generally are closely linked with stressors. Anxiety disorders cost about $42.3 billion in the 90s. Inevitably, that estimate would likely be far greater today.

The most expensive diagnosis is usually bipolar disorder. From absenteeism to lost productivity to medications, this disorder has a potent effect on profits. In fact, it costs about $6,836 per employee with bipolar disorder. Closely linked, suicide amounts to $34.6 billion in medical costs and work lost. And non-fatal suicide attempts cost $4.3 billion in lost wages and productivity.

Make companies care through stats

All of these statistics come from fairly reputable sources such as the Centers for Disease Control (CDC), National Institute of Mental Health (NIH/NIMH), National Alliance on Mental Health (NAMI), and peer-reviewed journal articles. As an academic, I trust that these organizations are estimating — to the best of their ability — the high price of mental health in America.

In the past, many companies discriminated against applicants with mental health concerns. Frequently, people were ruled out for jobs they would otherwise be qualified for because of mental illnesses. What the CDC, NAMI, and NIMH have worked tirelessly to do is normalize mental health concerns and reduce stigmas. They’ve worked to interject a hypothesis for companies, which is that everybody wins when you care for employees.

Each organization learned that to talk to companies you need to focus on the bottom line: profits. They’ve excelled at making terrific inroads with corporate giants that have instituted better fringe benefits, fun activities in the workplace, and greater time off. They know that companies want happy, healthy workers because that leads to greater sales, revenue, and shareholder returns. And, for the most part, it’s helped.

Treat the illness and profits will boom!

Mental health advocates in the corporate world seem to politely accept that companies are only motivated by numbers. They argue that untreated and undertreated mental concerns cost more than proper treatment.

Understanding this basic premise, companies have accepted a Mr-Fix-It-style psychology. Treat the illness, get better, and then get back to work! Similarly, healthcare companies rarely offer long-term mental health treatment, as it’s limited to short-term, brief therapy. To offer something more substantial would require companies to pay more profits to care for employees.

This pressure has led companies to ask researchers and academics to think of faster ways to treat distress. The question seems to be, How can we rapidly patch people up so that they can get back to work?

Models of treatment have focused on prescription pills and quick rounds of talk therapy to douse the fires. We’ve learned to cap emotional distress — to keep it in line with what corporate America needs.

Companies aren’t the victims, we are

Capitalism is predicated on a fatal flaw: work hard and be rewarded. Unfortunately, people are all born with different strengths and weaknesses, positions in society, and economic hand-me-downs. Working hard will look different for everyone. We are fundamentally created unequal, unlike the founding fathers suggested.

Men are generally taller than women, but that doesn’t mean they should get paid any different. Women live longer than men on average, but that doesn’t mean companies should begin to hire women because they could spend more years working. Our differences must be balanced out, because purely capitalistic forces fail to change the systemic problems.

And just like the aforementioned physicality and livelihood between genders, there’s great variety in mental health needs. People are not raised equally. Some parents are wonderful — others abusive. Some schools are the best in the country, and others are the worst. Some experience difficult traumas, and others seem to float by without incident. Our experiences from womb to tomb will vary greatly, and we need to learn to embrace this fact. Some people will need greater mental health care.

Flipping our understanding of mental health

Anything that gets in the way of working hard, being productive, and increasing revenue has — up until this point — been seen as an impediment. Being depressed has become a “bad” thing that you should avoid. Get that treated! It’s considered a flaw to suffer and hurt, because of the cost to a company’s bottom line. You’re causing profits to dip! Additionally, it’s encouraged people to stay tight-lipped and private about their struggles for fear of being ostracized.

When dollar signs flashed before corporations’ eyes, they listened. They understood that by making their employees healthier, they’d increase their bottom line. It would seem — for a moment — that capitalism was compatible with caring. But what if the money wasn’t there, would companies still care?

Companies desperately need to change the way they do business. Companies must see their employees as autonomous, capable, and creative humans. Companies must provide a space to excel, but also to seek freedom. Companies must look beyond the dollar amounts and pay for better time off and vacations. Companies must do their best to disregard the power of shareholders, in favor of respecting their employees.

Medical and mental health are in decline in America. Our system is bloated, expensive, and frankly, embarrassingly flaccid. It’s time we flip the paradigm. It’s time we say that workplaces need a reboot. It’s time for employers to receive the treatment. Perhaps it’s time to make companies work for us?

Filed Under: Social Justice Tagged With: America, Capitalism, care, Companies, employees, Finances, Google, illness, mental health, Psychology, statistics

I Have Zero Business Degrees

By Frugaling 13 Comments

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My Graduation Day 2011

What are my credentials?

Frugaling is a personal finance website where I regularly talk about financial concerns. I provide advice to save and make money, editorialize social justice issues, and argue in favor of minimalism over consumption.

But you might be wondering what credentials I have to proffer this help. Well, that’s a funny thing: I don’t have any. I didn’t get a business-related degree — there’s no formal finance education or economics indoctrination. My words are informed by something greater, and my hope is that they’re not the rote, memorized drivel that many financial advisors spout.

As a kid, I always thought I’d pursue something in finance. In fact, I want to tell you a little story from high school. It was there that I decided that to pursue a financial career path would leave me deeply unsatisfied, but my passion for personal finance never stopped.

Sam, you’re on the line!

I was giddy, but tempered in my high school science course. In about 10 minutes I’d ask my teacher to step outside and make a phone call.

My battery was fully charged, but I had to find a better signal. There was a field, away from the building, that provided a comfortable amount of strength. I dialed the number; I believe it was somewhere in New Jersey. I stayed on the line for what seemed like an abominable amount of time.

Occasionally, a pre-recorded voice piped up, that encouraged me to stay on the line. Then, I heard Jim Cramer’s — host of Mad Money on CNBC — voice and he shouted in my ear, “Sam from Golden, Colorado…” I melted with nervousness, but miraculously stated a ticker symbol (which I cannot remember) for a stock I was interested in.

Stocks were more important than classes

My latter high school days were filled with these moments. While fellow students studied diligently for their ACTs and applied to elite schools such as Duke and Stanford, my time was spent reading, trading, and watching the stock market. Because I was under 18, I forced my mom to co-sign and create a custodial account on an online trading site. I was hooked, and I loved the adrenaline.

Numbers pulsed through me, and I would binge on stock charts for hours. I hogged library computers and printer time to map them. In hallways and breaks, I drew lines on the charts, and practiced what I saw in books and television.

As an autodidact, the stock market provided an endless supply of data to be analyzed and understood. And the spoils went to the most educated people. I wanted to be one of them.

One form changed my degree, life

College was the path I was expected to follow. While my parents and grandparents never “forced” that path, it was strongly encouraged. The university life was where people went from good to great. I was open to that potential.

I applied to two colleges. The one I wanted to go to, Colorado State University, accepted me, but didn’t directly admit me into business. My less-than-stellar grades and contempt of mathematics meant that I would be an “open-option” business student until I proved my competence via good grades.

Prior to departing for Colorado State, there was an open house session. I attended one event geared specifically towards open-option students. For one hour, an advisor talked about academic success and finding your purpose in college.

I remember rolling my eyes, as the cynic in me dreaded the activity to come. We were split up into groups and then given about 10 minutes to complete a form and talk among the members.

The form asked us some simple questions, but one stuck out; it read, “How would you use your degree?” Despite the stupidly simple question, I had not really thought about this question before. I saw a response, “I want to help others.” Then I thought about my business degree — something wasn’t quite right.

I went to my advisor as soon as school started and asked to switch to psychology. There, I envisioned being able to listen and talk with others through their problems. That would be a degree to “help others.”

The psychology of money, spending, and society

After undergrad, I applied to graduate school and got into a counseling psychology doctoral program at the University of Iowa. I still wanted to follow the goals set forth in that open-option day. But in the back of my mind I recognized that investing and money issues still held great interest.

I still invested and read everything I could get my hands on regarding the stock market and business. I changed career paths, but my intrinsic passion for personal finance lingered.

As my own debt and spending spiralled out of control, I started Frugaling to right my course. It worked. I paid off about $40,000 of debt in about a year. I completely revamped my life — now incompatible with wanton spending and extravagances.

But I also started Frugaling as a perfect combination to meld my converging interests. I found that people’s (me included) monetary issues were closely linked to psychological concerns, distress, and stressors.

Psychology and business weren’t divergent topics. Additionally, I realized that most financial gurus blamed personal responsibility and character flaws on poverty, bankruptcy, and inadequate financial planning. There was room for a different voice — informed by psychological concepts and real counseling work with people suffering.

I’m not a financial-affiliated spokesperson

Over the nearly two years that Frugaling has been around, I have become an increasingly more passionate advocate for the underdogs. Financial markets are deeply unforgiving and unequal. People need to stand up and help others across diverse, multicultural backgrounds.

I ask you not to trust me for my financial degrees and letters after my name. I ask you not to trust me for how much money I’ve made for other people. I ask you not to trust me for being personally wealthy. I ask you not to trust me for my reputation (or lack thereof).

All I ask is that you consider the possibility that financial voices of reason come from those outside that insular world. I’m here to stand up for those who’ve been drowned out for too long. And I’m excited to continue building an audience (you included) that is inspired into action over social justice concerns and reducing consumption.

Filed Under: Social Justice Tagged With: Advice, Business, college, Finance, graduate school, investing, Personal Finance, Psychology, school, Social Justice, Stock Market, stocks, university

Frugal Articles of the Week

By Frugaling 5 Comments

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Reading Nook Photo

Every week I like to feature a few frugal articles that caught my eyes. Curl up in your favorite reading nook and enjoy. Hopefully these encourage you to live frugal lives!

Overpopulation, Overconsumption — in pictures via The Guardian
In this breathtaking and heart-wrenching group of photos, The Guardian has captured the cost of capitalism. From overproduced lands to trash in the guts of animals, our lifestyles have major consequences. The photographers of this series have captured the essence of our problem of overconsumption. Now, what should we do about it?

Stuff it: Millennials nix their parents’ treasures by Jura Koncius
This story cracked me up, because it’s totally true for me. With my more minimalist lifestyle and household, I can’t envision taking on all the material goods of my parents and grandparents. Sorry, mah! 🙂

These Debt Strikers Are Refusing to Pay Their Student Loans by Bill Kilby
For-profit colleges are one of the nastiest developments in recent educational history. They suck the life out of their students, over-promise/under-deliver, and sack their graduates with atmospheric levels of debt. Finally, a group of students from a for-profit collegiate system is saying “no.” They’re not paying their debts. And, frankly, all the power to them!

For richer or poorer: The challenges of marrying outside your class by Jessi Streib
Rising income and wealth inequality has some painful unintended consequences for couples. What happens when two people fall in love — one person from wealth and the other from poverty? The economics of marriage and coupling have never been more potent. This article is an important, critical view at these divided times.

Filed Under: Save Money Tagged With: articles, dating, Frugal, Lifestyle, marriage, Minimalism, overconsumption, overpopulation, pollution, week

$200 Food Budget Challenge: March Edition

By Frugaling 31 Comments

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Dunkin Donuts - Flickr photo by m01229

You donut-eating budget-buster!

It was Friday, March 27, and I was riding home from an interview. I felt bummed and left the offices feeling oh-so-average. I didn’t do as well as I’d hoped. Traveling by bike, it was hard to miss the “DD” sign ahead; our earthly savior and lord of sugar, Dunkin Donuts. I pulled over, and ran in to buy a donut. I couldn’t resist, and bought two.

The cash register read, “$2.10.” My head rang with confusion and disagreement. My body craved a treat for a tough month and day. Despite the qualms and questions, I stood at the counter, handed over my card, and promptly smashed those two donuts down my gullet. Gosh they were good!

As I pedaled away, I knew what those donuts would mean. They would be an exclamation point on another month above $200. They would be a sugary-sweet failure and reminder that I’m not quite there yet. They would be the stench of another month over budget.

The food budget challenge rules

Over the last couple months, I’ve been working to reduce my food and drink expenditures. Friends and readers have asked tons of great questions about the rules to this challenge. They regularly ask, “What do you count, Sam?”

The answer is simple: everything. Anything with a nutritional value is thrown into the bucket. That’s meant that birthday parties, get-togethers, and random snacks count, too. Nothing gets removed from this budget – for any reason.

The $200 food budget challenge was meant to be fun, but also restrictive. I didn’t want to create other budgets for “entertainment” or “eating out.” That seemed to defeat the purpose for me; especially, because much entertainment includes eating and drinking.

Reviewing my efforts thus far

I would love to be writing today with beaming pride. I would love to say, “I did it!” I would love to say I’m the perfect food budgeter and frugal guy. Sadly, I have a lot of work to do.

I started the food budget challenge at the turn of the year. Being frugal led me to sell my car, buy a bike, and save money, but there was still this ridiculous part: food. I was shocked at my inability to save in this category. 

When I lumped in food and drink, my monthly budgets were around $400-600. That level of spending was preventing me from being able to save anything. It was an embarrassing realization. I was eating out too much, buying too many prepackaged foods, and opting for organic – when natural would do. I needed to revamp everything.

In the first month, January, I spent $362.69. While down heavily from earlier months, I realized quickly that I had to find other ways to reduce my spending. Then, much to the dismay of my friends, I decided to start up the budget challenge for February. It would mean another month of restrictive splurging and lots of meals at home. I tried to opt for other items that were gluten free, but not at a premium, which helped in February. It was a relative success, and I only spent $211.94. But I still hadn’t reached $200.

$200 food budget challenge: March Madness edition

Here’s a breakdown of my spending from March:

Day 1: $106.03 (Groceries)
Day 2: $0
Day 3: $2.77 (Groceries)
Day 4: $0
Day 5: $0
Day 6: $13.75 (Groceries)
Day 7: $0
Day 8: $6 (Brewery)
Day 9: $0
Day 10: $9.27 (Groceries)
Day 11: $0
Day 12: $4.87 (Sandwich); $5.56 (Birthday party candies); $30.29 (Birthday dinner)
Day 13: $0
Day 14: $10.38 (Groceries)
Day 15: $11.01 (Mexican food)
Day 16: $0
Day 17: $1.25 (Redvines – must have sugar!!!)
Day 18: $7.47 (Groceries)
Day 19: $17.59 (Groceries)
Day 20: $0
Day 21: $0
Day 22: $9.66 (Groceries)
Day 23: $1.52 (Groceries)
Day 24: $0
Day 25: $0
Day 26: $0
Day 27: $2.10 (D’oh! Donuts!)
Day 28: $20.75 (Groceries)
Day 29: $0
Day 30: $0
Day 31: $0

Even from day 1, you can see I was doomed to fail. I spent over $100 in a single day, as my foodstuffs had grown dangerously low in February. I needed to stock up – big time. Unfortunately, that meant spending half the budget.

After the 31 days of March, I spent $260.27.

When I first started the $200 food budget challenge, I expected a linear decline in spending. Wrongly, I assumed that I would be able to gradually drop the costs month-over-month – that it would always drop. While $260 is less than January and well below previous spending, it spiked up from February. And needless to say, moved me further away from the goal.

Lessons learned this month

1. Psychological needs will creep into budgetary needs

A danger zone this month was sugary food. Because I biked to work, school, and the grocery stores, I was constantly burning calories. Despite my experience preparing for odd hunger times, the rush for sugar still hit me. I attribute this problem to a couple unmet psychological needs this month. I wasn’t sleeping enough, which led to tired days, where I was more susceptible to crappy food.

One of the best fixes to this problem is making sure you’re balancing out some of life’s demands. The best solution would be sleep. As a graduate student that can be hard to come by, but in April I want to work on this aspect.

2. Challenges become fun, but also competitive

I call this a “challenge” intentionally. Budgets can be boring and monotonous, and the reward isn’t short-term. Budgets help people accomplish long-term goals. Challenges, on the other hand, encourage people to work towards something in the shorter-term. For me, I needed this push to reduce my food budget.

Now, three months down, I’ve realized that the competition isn’t just internal. When I bring up the idea with others, I constantly hear comparisons. Some people assume it’ll be easy to accomplish, while others doubt themselves. Let me assure you, if you aren’t regularly around $200, it’s difficult.

Then there are the negative comments from others, unfortunately. Challenges sometimes bring out the one-uppers. These are the people that aren’t providing constructive criticism and suggestions, they’re just making it clear that they can do better than you. Generally, I find this feedback to be debasing and detract from the main goal: a fun challenge that we can strive for, together.

3. Food budgets should be averaged month-over-month

When I present my results, you only see one month of activity. In reality, food budgets are averaged over your lifetime. As such, people can buy huge foodstuffs from Costco and other warehouse-style retailers for deep discounts. This bulk buying can save money over the long-term, while ostensibly increasing a single month’s budget.

Because of the power of bulk buying and saving, next month I intend to account for my food budget in servings, when possible. For example, I purchased a 10-pound bag of rice, and I’ll account by 1-cup scoops next month. Although, with more perishable foods, I’ll account for those by receipts, as I’ve done.

As I enter my fourth month of the frugal food budget challenge, I’d love it if you’d join me! Even if you fail, as I have, it’s a great test to see how much you’re spending. To those who are struggling to wean down their budgets, try it out! To those who’ve succeeded, what have you done? Cheers to April and good luck!

Filed Under: Save Money Tagged With: bike, Budget, challenge, Dunkin Donuts, Food, groceries, market, Save Money, Store

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