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Take Action To Reduce Climate Change And Lower Monthly Bills

By Frugaling 5 Comments

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The crisis of climate change

The climate is completely off-kilter. As humans, we’ve contributed to an atmospheric rise in climate change since the industrial revolution. It all traces back to our abundant consumption and fossil fuel use. In case there are skeptics in my audience, the evidence is clear that humans impacted climate change dramatically.

A couple months ago, the New York Times reported that,

A large section of the mighty West Antarctica ice sheet has begun falling apart and its continued melting now appears to be unstoppable, two groups of scientists reported on Monday.

Something snapped inside me, and I felt deep pain. How could we have done this to ourselves and the planet? I actually teared up, thinking about how we treat each other and this planet. It really hurt.

Shortly after that article, another was published that warned, the “Worst is yet to come.” Research found that record heat and floods were largely due to climate change:

The American scientists said the rise could be anywhere from one to four feet, and added that six feet could not be ruled out. Along much of the East Coast, the situation will be worse than the global average because the land there is sinking…

There goes New York City, Boston, parts of D.C., Miami, and more. We don’t have a contingency plan for all these people. The devastation would affect tens of millions of people. Individuals would flock to the west for shelter and a new start; at least, those who could afford it. I hesitate to think about those who might not have the economic freedom to up and leave low altitude areas.

Our consumer, consumption culture

This unpleasant, scary picture for the planet’s future is contrasted by a strong consumer culture that values growth, dominance, bulk, and abundance. When gross domestic product (GDP) estimates tumble on the national scale, economists, politicians, and Wall Street scream bloody murder. But when the temperatures are rising globally, and sea level rise is threatening entire countries, there’s silence.

We are an economy that’s feasting off of short-term gains, prolonged ignorance, and immediate gratification. Climate change skeptics are a dime-a-dozen and they’re propagating messages that are scientifically unproven, untrue, and dangerous. It’s all motivated by moneyed interests, and they’re looking for a way to keep the consumption going.

DJIA Stock Market Growth
30 stocks make up the Dow Jones Industrial Average (DJIA)

Our entire economic system is predicated on continued growth, but it will slow. Whether because of declining population growth rates, economic instability, or climate change, the economy will need a correction. It’s hard to fathom the willful, blissful ignorance of the markets, but the economy has not yet accounted for the pains of climate change. Just look at the most recent national weather tragedy, Hurricane Sandy:

An estimated 1.8 million structures and homes were destroyed or damaged, with economic losses exceeding $65 billion.

Unfortunately, the storms, floods, and wacky weather are only expected to increase. The economic consequences will be devastating for this country. Something’s gotta give.

Make an individual correction, save big

Frugality, simple living, thriftiness — whatever you want to call it — goes hand in hand with reducing carbon dioxide emissions into the atmosphere (CO2). By consuming less and saving more, your actions can greatly help the environment.

Climate change is simple science. The more CO2 in the atmosphere, the more the earth’s temperatures will rise. The sun’s rays/heat will be trapped in our atmosphere, and keep us warmer. We needed some CO2, but now we have too much.

Congress and the greater world seem doomed to delay powerful action to reduce the effect of carbon emissions. While moneyed interests, lobbying groups, and industry experts delay necessary change, you needn’t stand still. There’s still time to take action.

Here are 7 ways you can make an individual impact on climate change and save big:

  1. Walk, bike, or bus to school/work instead of driving
  2. Bring your own bags or reuse them at the grocery store
  3. Shut off water when you’re not actively using it
  4. Turn off your lights when you leave home
  5. Try to buy local foods and products when you can afford them
  6. Turn off or get rid of your air conditioner
  7. Encourage friends, family, and your own politicians to care for this issue, too

Filed Under: Save Money Tagged With: carbon, Climate, climate change, CO2, Congress, Consumption, Culture, Hurricane Sandy, refugees, shelter, tax

4 Ways Coupons Manipulate Spending Habits — Watch Out!

By Frugaling 13 Comments

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Every Wednesday and Sunday — if you subscribe to a paper — you generally receive a healthy dose of coupons. Everything from soups to toilet paper to deli meats are frequently included in the pile. With open arms, many clippers sift through the mass to find a couple deals.

Some people collect them, place them in binders, and combine coupons with store deals. Websites and shows like The Krazy Coupon Lady and TLC’s Extreme Couponing examine, research, and find incredible coupon-based deals. Everyone seems to love coupons!

You should be concerned.

Coupons are developed by vast marketing and advertising teams for corporations. The advertising industry as a whole is estimated to be in the hundreds of billions, and a significant portion is outlined for couponing. But subtly, clipping those weekly coupons affects the psychological decision making in the supermarket. Here are 4 ways that coupons manipulate your spending habits.

Watch Out! Coupons Manipulate Spending Money Cash1. Clip, cause cognitive dissonance

Every time you clip a coupon, your mind buys a product. Even though you haven’t gone out and purchased the item, to clip a coupon, it’s a commitment of time and action. This has a direct effect on your wallet.

A powerful psychological effect that can occur when you clip a coupon: cognitive dissonance. If, for instance, you decide to clip a coupon and then later question whether you really need the product, this may lead to dissonance. Essentially, this is a distress associated with spending the effort to clip a coupon that you now might not use. For many people, they’ll use a coupon just because they clipped it — regardless if it’s the cheapest option once they get to the store.

2. Exposure predicts spending

Exposure is the key to purchasing a product. What a simple conclusion, right? Well, stores know that the more face time you have with a product, the more likely you are to buy it. If the exposure begins prior to entering the store, you’re effectively being primed for the future purchase.

With coupons, your eyeball sees the product at home. If you clip it out, you are further intensifying the duration of the exposure. More time in front of you equals more money for the grocer and advertiser. How easy!

3. Is that really any cheaper?

One of the most important reasons that people clip coupons is to save money. Ironically, this may not actually lower your shopping bill. Coupons are not usually offered for generic, store-brand merchandise or fresh produce. Instead, they’re frequently marketing name brand items that already have a built-in premium. This added cost often voids any discount associated with using a coupon.

It’s very important to pay careful attention to the coupon you’ve clipped out. At a store, you need to look for generic items, and then compare them to the name brand item for the coupon. All of this takes a level of vigilance and time that many don’t have or care to have at the grocery store. For both time and money, just buying generic items is normally the best bet.

4. Coupons are getting smarter

Smartphones, apps, and online coupon sites are increasingly digging into your spending habits. Your rewards credit card, frequent shopper card, and web browsing history may be leeching your data to third-party companies. These organizations then will compile and predict what you want. They’re so accurate that Target can tell when you’re pregnant, about to have a child, and/or the ages of your children (read Brandwashed for more on this tactic).

By using these predictive tactics, companies can practically read your mind. If they know all your purchases and habits, coupons can be created that make you look at new, similar products. These choices may cost more over time, but offer a great deal at first. If you like the newer product more, the system has worked and you’re hooked. Now, the money is theirs to reap.

It’s not that coupons are always bad or more expensive than generic brands, but they can sometimes change your spending habits for the worse. Moreover, think about all the time that’s necessary to clip those coupons and find the special savings — this adds up. If you spend your time making more money and buying generic, this could actually be smarter in the long run!

Filed Under: Save Money Tagged With: Budget, Card, Consumer, Consumerism, coupons, Food, Freebies, Frugal, generic, Save Money, spending, supermarket

Riskiest Place For Money: Mattress, Bank, Or Stock Market?

By Frugaling 10 Comments

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Cash counting machine 20s

Over the last year, I developed a budget, started making more money than ever, and used credit cards to hack travel costs. I’m more motivated than ever to save money. Using this tactful budgeting and planning, I now have a surplus of savings! After years of bleeding red to student loan debt, it feels deeply satisfying to see the positive, green numbers.

Now that a little nugget of savings has developed, I’m realizing a different anxiety. There are various market actions that can negate your savings plans, and it’s important to protect against them. It seems like every place I look, there are risks for your nascent savings. Today, I wanted to spend some time explaining a few of the risks that await your new wealth.

Under the mattress?

Pros. The classic paranoid and/or privacy-minded decision is to just stick your extra savings under your bed. My late-grandmother seemed to be deeply concerned about her possible access to funds — likely influenced by the Great Depression — and she would constantly have funds hidden away around the house. I thought this was rather bizarre, but appreciated her desire for some amount of cash in case of emergencies. Most importantly, you are not exposed to stock market risks or banking fees.

Cons. Sticking your little nest egg in a little home safe or inside your mattress comes with some risks, too. Not only is your money literally exposed to the elements (i.e., fire, flood, or other natural disasters), but saving your money at home may be put your household at risk for burglars. Lastly, this decision makes you completely vulnerable to inflation (which is a serious long-term concern), you don’t appreciate from interest, or gain stock market exposure that averages about 7-10% per year.

In the bank account?

Pros. Take your paychecks, bonuses, and side income and leave it in your bank account. This could not be easier, and you don’t need to spend any more time deliberating and considering financial decisions. Although, if your money is deposited into checking account, I’d recommend transferring funds to a high-yield, online savings account. You don’t bear any of the stock market risks and there isn’t any risk of loss. All checking and savings accounts are insured through a government organization called the FDIC (Federal Deposit Insurance Corporation). The deposit insurance covers each account up to $250,000.

Cons. Even if you’re using a high-yield checking and savings account, you’re likely receiving less than about 1% interest. Inflation is a nasty, hidden force that can eviscerate your savings. For the month of April 2014, inflation in America was about 2.0%. Effectively, just holding it in a bank account will cost you 2% or more if inflation becomes worse.

In the stock market?

Benjamin Franklin Quote Personal FinancePros. Benjamin Franklin really said it best, “A penny saved is a penny earned.” Now that I have some savings, I’d like to make the most of it. I want to send my dollars out to work for me. I opened a couple financial accounts, one of which is an E*TRADE brokerage account. With low transaction fees and commission-free ETFs, this was an easy decision. I’ll be making about 7-10% per year, and attempt to invest in high dividend stocks. This method defeats inflation and puts it to work, as I build a little savings.

Cons. Of all the methods mentioned, this is definitely the riskiest. Investing is not free from thievery and scum; hell, I’d prefer a burglar sometimes, as they do less damage. The Dow Jones fell over 50% during the most recent bubble and crash. (Interested in getting an in-depth understanding of the crash? I highly recommend reading The Big Short by Michael Lewis.) Most investors were decimated by the stock market’s movement, which was caused by bubbling housing prices, credit default swaps, and a variety of predatory practices by big banks. By joining this arena, I’m exposed to criminals on the grandest scale.

There’s no perfect, safe place to store and build a savings. Every option contains risks, and it’s important to consider each and every one of them to make the smartest decision for yourself. For me, I’m taking risks and putting my money in the market. I’m young and looking to put my money to work as fast as possible. 

Filed Under: Save Money Tagged With: Accounts, Checking, Income, invest, investing, money, Save, savings, Stock Market

Accidentally Frugal

By Frugaling 14 Comments

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Accidentally Frugal - Let It All GoWhen I think of my apartment, a number of things come to mind: gulag, cinderblock castle, bat cave, and my favorite, rectangular ode to communistic utilitarianism. Yes, my home is something special. One of the perks is insulation that never seems sufficient for either hot or cold extremes. In the winter, the bare linoleum floors chill bones — forcing occupants to wear sandals or shoes indoors. The summer brings a respite from the cold, and makes my apartment heat up like a sweat lodge — only, without the nice cedar wood smell.

The summer months bring some wacky weather through the Midwest. This being my third summer in the land of flat, I know that I’m in for hot, sticky days that border on 100 degrees — even overnight. Torrential rainfalls will produce floods and muddied areas, while you get baked throughout the other days. Pretty good if you’re a 4-year-old making mud pies; beyond that, not really quite sure who enjoys it.

I’ve lived in a few areas of the country that don’t really need air conditioning. People may have them attached to the home or in a window, but for the most part, these white boxes stand as decoration to a humble abode. But here in Iowa, air conditioning is a must have.

In August, I’m moving into an apartment complex that is supposed to have built-in, central air conditioning. To prepare for this, I decided to list my air conditioner on Craigslist two days ago. I hastily placed it online — without a picture or many details. It can take a little while to sell things in my city. There aren’t many people here; especially, over the summer.

I fully expected it to take a month to actually sell the unit. I was dead wrong.

Well, Frugaling fans, I’m in for one hellish summer. I just got back from selling my window air conditioning unit in one day. The family I sold it to were incredibly appreciative and kind — even paid me to drive to their place. The man who lifted the AC out from my trunk said, “Boy are we happy to have this right now. It’s only going to get worse and worse this summer.” All I could do was politely smile and nod. Inside, my stomach churned with the anticipatory anxiety of an entire season without it.

Naively, I didn’t think I’d spend an entire summer without air conditioning, but in a way this is all accidentally frugal. Letting go of the air conditioner this early in the summer season feels like trouble, but there are some tremendous benefits.

  • Reduced utility bill. The summer months can wreak havoc with my careful budget. Oftentimes, the budget is precariously balanced and if there are extended periods of heat, I can see my bill skyrocket. Most of those costs are associated with increased air conditioning use. Without this appliance, I’ll be struggling, but saving every minute that it’s not running.
  • A family in need is helped. AC units can be expensive and a family (with a pregnant mother) will enjoy the benefits of a cooler house. I’m really happy they were able to use this and save a pretty penny from buying new.
  • My wallet is padded. I didn’t just do it for purely altruistic reasons, though. I’ll be able to pay off another chunk of debt with this extra cash. Even more than paying off another portion of student loans is the psychological benefit of knowing I’m moving in the right direction — saving and earning. This has been my major goal since starting Frugaling.
  • Saving the environment. Air conditioners are a drain on energy resources, tax aging infrastructures, and push coal-fired power plants to go into overdrive. Removing the AC will reduce the amount of greenhouse gases I contribute. One of the most frugal things I can recommend is opening windows at night, and then closing them immediately in the morning. Also, put down your blinds. This small step will effectively insulate you from changing temperatures outside. Your apartment will be a nice ice box in comparison to the outside temperature.

Filed Under: Save Money Tagged With: ac, air conditioning, apartment, energy, Frugal, heat, home, house, midwest, minimal, Minimalism, minimalist, seasons, summer, weather, Winter

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