Frugaling

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If I Were Rich, Would I Still Be Frugal?

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Thanksgiving Dinner, Wishing I Was Rich

For my first year of graduate school in Iowa City, I wasn’t able to get back to see family for Thanksgiving. Motivated by the irony and sadness of spending the holiday alone, I watched a sappy movie and ate a cold turkey sandwich. This sorry state was only amplified by my linoleum/concrete floors that were like permafrost ice blocks for my feet, and the dingy, yellowish light of my apartment. All I could think was, “If I were rich, how would this be different?”

Dreams of a vacation I didn’t have

Presumably, I would’ve sat near the front of the airplane — speeding to my destination. The service would’ve been better, too. Maybe I could’ve afforded a first-class ticket. Perhaps this could be a regular weekend getaway. Luggage fees wouldn’t have been usury and awful — just mere pennies to my millions. Although, I probably would not have needed to pay for those fees anyways, as my credit cards and connections would lead to waivers. Either way, I would’ve been wealthy enough to afford whatever outcome. I would never stand in front of a ticket counter, after buying a ticket online, and be surprised that there’s an additional bag fee — breaking my budget and robbing me of my little available savings.

Finally at my destination’s airport, I would’ve rented a car. Not just any car, but a luxury vehicle to speed around the mean streets — something familiar and like my lifestyle. Again, I would have enjoyed the whisk and breeze of skipping lines, priority rentals, and free upgrades. My parents, family, and friends wouldn’t have needed to worry about me; I’d show up on time, no help and reliance necessary. Time would continually be on my side, as waiting would be heavily reduced.

As I walked through the airport, and saw the nice luggage and bags, I could have looked them up on my phone and instantly purchased my own. I wouldn’t need to hesitate to buy something so practical and helpful. Why not get some class with a Louis Vuitton set? Throw in those shoes, too! Traveling in style feels better.

Going home, I would have been excited to see all the friends and family I could. But I’d have to look sharp. Maybe I could stop by my favorite barber for a cleanup? My photos would be filled with the material goods that ooze success. I could show my parents, in person, what they had raised — that I had picked up my bootstraps and become a capitalistic achievement. They could be proud of my wealth and ability.

Thanksgiving without family, but not without heart

Reality is a cold shower. I can’t remember the last time I purchased something and didn’t feel guilty, nervous, and anxious for the added expense. I had looked at plane tickets for this Thanksgiving, but at nearly $500 plus airport shuttle fees, I couldn’t afford it. In a way, it felt like I was forced into frugality, without a choice (unless you consider debt to be an option, which I don’t).

As my friends and the rest of this consummate college town fled their studies and small-town lives for another location, there was a powerfully isolating feeling to my thriftiness and decision to stay. I fully expected it to be another cold turkey sandwich and night alone, but that all changed when a co-worker invited me to dinner. He knew I’d be here, without plans, and suggested I tag along.

What really matters

In that moment of deep gratitude, the Louis Vuitton dreams subsided. Pictures of first-class comfort and VIP lines faded. Suddenly, I felt humbled by his generosity and honored to be included. I was truly thankful — without any need for material goods, money, or proof of my worth.

Wealth is a funny target. If I only wanted to make money, I should’ve chosen a different career. Instead, I was motivated to help others and temporarily delay earning potential. My path to occupational success likely won’t include boatloads of cash.

Undeniably, if I had enough money available, I would’ve flown to Colorado to see my family. And honestly, if I had the money, I would’ve loved the creature comforts of first class. Both of these decisions would get me spending more money and being less frugal.

But at the end of the break, it was clear and simple: I just wanted to enjoy the day with people who are kind and open-hearted. Wealth just didn’t matter. If I were rich, I would’nt have wanted anything more than to share that moment with those I care about.

My Bike Ride Disaster: Wet, Dirty, And Full Of Road Spittle

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Bike ride through the city
Photo: Dustin Gaffke/Flickr

My first fall in fall

This summer I purchased my first bike in years. It quickly became an enjoyable habit. My body became stronger and I can now bike about an hour before getting really tired (backpack and all). It’s forced me to think about climate change and my impact on society; thankful too, because I’m individually reducing carbon emissions. But I’m also open to the elements like never before, and that comes with serious risks.

It was drizzling today, and the roads were riddled with puddles and rivers. If I still had a car, I wouldn’t have thought much of it. I would’ve been isolated from the elements. Cars are protective bubbles and creature comforts. My commute into work would’ve been simple and relatively safe. Instead, I took the first fall on my bike.

Every time I hop on my bike I realize all of the variables that are working against me: my brakes might not work, a car may hit me or otherwise cause me to lose control, a tire may pop, etc. Unfortunately, I wasn’t considering the most obvious possibility this morning: pedestrians.

As I made my way to campus, I took note of my increasingly moist bum. I reached back to check, and found a nice patty of road spittle. Yes, this wasn’t one of my favorite bike rides. Nonetheless, I had no other option at this point and needed to get into work on time. My legs peddled onward.

I crossed the river and was nearly there. The light was green and I began to turn right, when a group of pedestrians crossed illegally. My brakes squealed, as I squeezed to prevent hitting one of them. Then, the bike lost traction and I completely slid off and down. My entire right side was covered in dirt and rain and ominous road schmutz.

People called out, “Are you okay?” Despite the immediate feeling of road rash, I hadn’t hit my head or broken anything. Someone picked up my coffee mug, and handed it to me. I fixed my helmet, put my mug away, and biked another 300 feet into work.

My foreign, happy reaction

But despite this inconvenience, anger, and wetness, I’m curiously happy. Even I question that feeling, “How could I be happy after a group of pedestrians caused me to slip and fall? How could I be happy sitting in wet clothing?”

Well, I’ll tell you!

When I first bought my bike, I wondered how long it would be before I was craving a car. But that feeling never came. Aside from stealing a ride with friends here and there, I haven’t driven more than a handful of times since mid-summer. Each month, I’ve been able to save an extra $300 dollars per month by not having a car (loan, gas, insurance, repairs, maintenance, etc.). Selling the car and pocketing the savings led to a reversal in my net worth, too. I’m finally in the black! And from a future standpoint, each time I take a bike or bus, I am contributing to a different carbon economy.

Dealing with winter

The seasons are changing. And now that I no longer have a car, I feel it like never before. My clothes are soaked and my body is ice cold from the spill. Work feels a bit more uncomfortable with the growing bruise engulfing my right side.

The weather will worsen. Winter in the Midwest is a horrific tragedy of gray and cold. Biking consistently through that will not be possible. While there are some buses that run through the area, the timing of interchanges may lead to severe delays and time lost. It will be a major time to question transportation and work-life balance.

No matter what happens, I’ll be sure to update you on my choices and how they affect my budget. For my bikers out there, be safe and ride on! And, read this awesome article about bike safety from Grist.org!

How Much Could You Save By Cutting Your Own Hair?

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I vividly remember the first and only time my dad gave me a haircut. I was in elementary school, and he got the ambitious idea to save on haircuts by doing them himself. We got a stool and went outside, where he promptly destroyed my social life with a botched bull cut/bowl cut that reminded me of Ursula’s tentacles from The Little Mermaid.

My dad was left in the dust, when I stormed off to seek shelter from follicular destruction. Safety was a sidewalk where I pouted unmercilessly. Dad got the message. From then on, we went to a proper haircut place (Notice I didn’t say salon or barber? Not really sure what to call them). It always had clips in the title: “Sam’s Clips,” “Great Clips,” “Sports Clips.” You get the picture.

The haircuts were always mediocre, but at least they didn’t function as a new wave contraception device. Each time cost about $15-17 after tip. To stay fresh and fly, I would go every two months or so. Conservatively, that came to be about $90 per year — but likely more than that.

It wasn’t until college that I got the brilliantly simple idea of cutting my own hair. After wondering what could possibly be so complex about buzzing off the sides and leaving the top a little longer, I decided to try it out. The first thing I noticed was how inexpensive clippers/buzzers run. You shouldn’t expect to pay more than $20-25 for a complete set, which offers different sized clips, scissors, and sometimes a detailing tool. They require little to no maintenance; albeit, they recommend regularly oiling and cleaning. In one to two haircuts they pay for themselves.

Get Your Haircut
This may be appear to be a mugshot, but I assure you it was simply a pre-haircut photo.

I purchased a Conair set, and began weed-whacking through a bushel of hair. I used a 3 clip around the entirety of my head, which made it impossible to screw up. By the end of it, I had already saved $15, time getting to and from a shop, and had an innate sense of pride in accomplishing it.

It’s been about 4 to 5 years since that fateful haircut. Now, I almost exclusively cut my own hair and/or receive assistance from friends and family. The savings are incredible. If you calculate the it at $90-100 a year (in haircut alone, which doesn’t account for time and transportation costs), I’ve likely kept more than $450 in my pocket since the switch. More money in savings, to invest, and pay off debt — what could be better?

The one major downside is that it’s never perfect. I’m limited in styles and sizes. Cleaning up the little, tiny, microscopic hairs within crevices and in between floor tiles is monotonous. I can’t say I enjoy getting to know the difficulties of cleaning hair off of grout. Alas, these are all but minor inconveniences to the half a grand I’ve saved over the years.

To commemorate my latest haircut, I decided to film it using Instagram’s new app, Hyperlapse. Hope you enjoy and let it inspire you to cut your own hair soon!

Check out another article, which highlights 3 popular grooming mistakes that men make!

Think Compounded Interest Is Always Good? Think Again.

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Manhattan Beach Undertow of Debt

When I had nearly $40,000 in student loans, every purchase felt like an impediment to conquering my debt. It was debt on debt. A tragic snowball effect, each item cost more than the sticker price — every time. I didn’t think I could leave this cyclical world — doomed to mistakes for decades to come.

I was dissatisfied with my spending choices. For instance, after my first installment of student loans, I promptly bought new furniture for my apartment and splurged for a nice car (made possible by another loan). Oh, the humanity! I was making some horrible decisions.

I had entered the world of debt without an escape plan. And I just kept spending. Then, a major wakeup call hit me: debt could prevent me from living the life I want to lead. Excessive student loans would nearly force me into certain career trajectories, as well. I wanted to make a change, but still saw little hope of reducing my debt (while in graduate school).

With greater financial literacy and competency, I developed an eagerness to make some sort of change. One of the largest lessons in the personal finance world is compounding your gains via interest, dividends, and other regular income. Essentially, you earn a regular income from your investments, which can then build even more wealth. By using this method of saving and building income, your money will work for you. It’s a brilliantly simple way of making sure you continue to amass wealth. I wanted to make this happen.

Unfortunately, I was filled with dread, as I realized I was on the wrong side of compounded interest. My $40,000 in loans were actively earning interest for banks and the federal government — ranging from 3.5 to 6.8% APR. Money was working for someone else. I was fighting against a sinking ship of debt, which compounded every day. Every day, I ended with less money than I started — even if I didn’t swipe or spend a dime.

When compounded interest is working against you, it feels like the Pacific Ocean’s undertow. You step into that warm water (spend a little bit of money you don’t have), and it slowly takes you out to sea. At first, you don’t notice the gradual loss of sand beneath your feet (the bills beginning to add up). It can be pleasant — relaxing even — to swim (and spend). And as you swim, you lose sight of the shoreline. Suddenly, you’ve been sucked out to sea and it can be hard to see how you get back to square one.

A fluke — one-off — happened to me over the last year-and-a-half. I started Frugaling.org, recreated a rock-solid budget, made more money than ever, and began to invest. The debt was handily defeated. It was at a precipice in my budget — my net worth reached zero, again — when I realized the powerful hold that compounded interest had over me. I was now free from the undertow of debt, and I ran away as fast as I could.

We have a horrific, metastasizing problem in America today: student loan debt. What happens is that people in their late teens and early twenties begin to rack up massive figures before they see their future paychecks. It’s a recipe for disaster, and the country will suffer from this.

Unfortunately, there’s an even bigger problem from delayed income and growing debt: we delay saving and building for retirement. We eschew the benefits of compounded interest — in our favor — and suffer under the debt. This restricts our ability to become entrepreneurial, live healthily, take risks, and build a better future (for ourselves and future generations).

Today, I’m standing on the other side of compounded interest — the one where I steer and control my finances. I feel empowered by it. I don’t necessarily want more and more wealth, but I don’t want to be back in debt ever again.

I’m done with that undertow.

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