Mogul In Training

I cannot tell you how many times people have commented on my frugality; some meaning it as a compliment and others being sarcastic and meaning it as an insult. For the record, I am never offended by being called frugal. But what I am offended by is the underlying thought by the majority that frugal means self-deprivation.

First and foremost, I'd take frugal any day over the lifestyle I see many others living. But, I wish (or maybe not) I could get people to realize that my life involves no scarcity. For example, I once had a conversation with a friend who is also a co-worker. We were talking about how we spent our extra paycheck (we are on the 26 paycheck pay cycle). She proceeded to explain all of the wonderful things she did and bought with her "free" money, but then she turned to me and said, 'I bet you saved your whole check, right?". To that question I responded, "No, I saved half and spent half". What confuses me is, I don't even know how people develop their opinion of my lifestyle because I never talk about it. The conversation about the extra paycheck was initiated by my girl friend, not me.

Any-who, I do not deprive myself in anyway--which is the main reason why I will never give up my handbag collection. It is my one indulgence and I would feel like "not me" without it. But, I also know the difference between frivolous spending or spending because of peer pressure. I cannot begin to tell you all of the crazy excuses I've heard from friends to justify their ridiculous spending--'But if I use my debit card, I have 'keep the change' and the change goes into my savings account'; or 'See, it was on sale, so I only spent $8 dollars for it (an item she bought solely because it was on sale, not because it would serve a purpose in her life).

Being frugal to me means evaluating whether or not I really need an item, will it serve a definite purpose in my life and how much use will I get out of it. Also, would I be better served borrowing the item if I would have limited usage for it. Additionally, when I do choose to purchase an item I will never spend more than I feel it's worth; whether the cost is $7 or $200. You see, for me, it is not about the cost, per say, but the value. I will definitely pay what an item is worth, even if it's an expensive item (even though I may be inclined to wait for it to go on sale). I've found that most people don't understand this concept--which is fine for them, I guess. But what bothers me (and I will admit I am bothered by this), is the underlying judgment that others have about people who refuse to spend their money mindlessly. It was part of my motivation for starting this blog.

So, what do you think? Do you sometimes feel judged by others for your frugal ways?

I've been out for a bit, having surgery....that's a post that is coming sooner rather than later. Anywho, I'm back to the blog, now. The extreme HIGH cost of getting sick in the US of A made me really appreciate my frugal ways; notice, I said frugal and not cheap. Which brings me to another issue...the naysayers.

There are always those who will criticise us, PFers. We have all heard the taunts, "Oh, live a little", "You can't take it with you", "You only live once", "You could die tomorrow", and on and on.... Like I stated earlier, I never talk about money. I simply set my entertainment and miscellaneous spending plans, buy from Ebay, buy on sale, etc and continue to live my life, thinking no one is the wiser. However, even without me saying a word about my spending habits or being "preachy" to others about their lack of financial planning/priorities, there are always the comments. Case in point, I had family in town visiting. I have a TV that is on it's last leg, and at the time, I was thinking of replacing it. I have since nixed that idea because now I watch most of my TV on the internet. Anyhow, during the visit, I had to hear constant comments about how they know, for sure, that I can afford a new TV and how they couldn't understand why I just don't buy a new one.

At the time, my plan was to save a reasonable sum, watch the sales and discounts, then purchase a TV when the price was right. Upon telling this to my family, they, of course, thought that I was absolutely crazy. According to their reasoning, if I have enough money remaining once my bills are paid, why not go out and by the latest and greatest TV; forget the fact that I don't really watch TV anymore. Everyone has a TV in their home and flatscreens are the only way to go! I basically told them I would purchase a TV when I had saved the money and had to kindly ask them to not bring it up again.

I can never comprehend how people DON'T "get it". If every financially responsible person ran out and made every purchase on a whimp they would be neither financially responsible or have an emergency fund. My method for dealing with the naysayers is to keep my personal business personal, while I allow them to live how they choose and request,kindly, that they allow me to live as I choose. Luckily, I don't have to deal with such inquisitions from friends.

The idea for a No-Spend Weekend came from a fellow PF blogger at Cash Only Living. Ms. Cash Only had an entire No-Spend Week. However, I decided I had to start small, so I chose a No-Spend Weekend. Initially, the plan was to choose a weekend that I had no plans with friends--that was the plan, at least. I set one rule that stated although I had no plans with friends I could not just sit home all weekend--the key was to find out how much temptation I could resist. Friday night, I ended up staying in because of severe weather and tornados in some areas. Saturday, I had to attend the tutoring session that is part of the program that I direct. There was a catch to the tutoring session, however. Tutoring is the first Saturday of each month and I am responsible for picking up the breakfast. I bought the breakfast, but the school reimburses the cost. It is a budgeted expense for the program, so it does not count as me making a purchase.

So, I attended the tutoring from 8am-11:30am and ate all the free breakfast I wanted. Afterwards, I returned home and had lunch. The plan was to go out and explore the city, but by then the weather had turned bad again. It rained for a good portion of the day.

Just when I thought I was in for the night, I got a call from a girlfriend reminding me that I had RSVPed to a surprise birthday for a co-worker a little over a week ago. I was about to say I had forgotten and couldn't make it because I had not purchased a gift---and could not just run out and get one because of my No-Spend Weekend. However, she reminded me that the co-worker's daughter had requested no gifts and instead requested we make donations to one of the birthday guy's favorite charities. The charity information would be provided at the party and we could make the donation by internet--which I must do today. I went to the party and ate all of the free food I wanted; while it stormed cats and dogs outside. The weather cleared enough for everyone to make it home safely then continued to storm the rest of the night.

Sunday was the usual, church, then home. I used the remainder of the day to continue reducing items and decluttering. I really did not have any temptation to spend all weekend--until Sunday night, that is. I was SO ready to give up by 8pm; not because I had an incredible urge to spend money, but because I was CRAVING soda so bad and had none in the home. I decided to fight the craving and used that time to reflect on how I would have just gotten into my car and bought a soda from a fast food drive thru. I resisted and drunk Iced Tea instead.

I left home early enough this morning to run to the grocery store to buy food items for this week to have for lunch. My first frivolous purchase now that I'm back on my $40 a week spending plan: An ice cold, Dr. Pepper from the office vending machine. A Dr. Pepper never taste so good!

Consequently, since I spent no money this weekend--and taking into account I only spent my allocated $20 spending for the week--My grand total spending for all of last week was $17.29.

Needless to say, I am SOOOO proud of myself!!! And a special thanks to Ms. Cash Only for giving me the idea. I think I will try a No-Spend Weekend again when I know, in advance, that I have no plans for the weekend. It was fairly painless.

While perusing Personal Finance blogs, I discoverd the blog Cash Only Living. The owner has challenged herself to a No-Spend Work Week. Because I think the experiment is a great one that takes a lot of discipline and self-control, I have decided to test it out myself. There is ONE catch, however. My No-Spend will be a weekend and not an entire week.

So, this weekend (April 30-May 2) is the time I have decided upon. For me, I usually consider the weekend Friday and Saturday because those are the days I usually socialize. But for this experiment, I will expand my weekend to Friday, Saturday and Sunday. In order to have success at this attempt, I will have to carefully plan and make any necessary purchases today.

Now, the plan.....I usually grocery shop on weekends, but I will grocery shop today, upon leaving work. I have a baby shower gift to buy, which I was planning to buy this weekend; but will buy today also. Ditto for a few household items, and getting car vaccummed. I do not have any entertainment plans with friends and if I am invited last minute, I will have to refuse. But, the main catch to my No-Spending Plan is I CANNOT just sit at home all weekend. So, I will be a tourist in my own city and go to some places that could (possibly) be tempting.

I want to test the degree of my will power as it relates to purchases. I have pretty strong will power with anything I put my mind to, and I don't see how this will be any different. However, this will be my first attempt and if something extreme happens where spending cannot be avoided, I won't beat myself up over it. I will just plan more carefully next time and make another attempt.

Updates coming next week. Stay tuned.....

In a nutshell, I was able to stick to my $40 a week Spending Plan. In order to keep track of every penny I spent, I put a container in my car to store receipts. Also, I found a website called SpendingDiary.com that I used to track my entertainment spending. Once the numbers are entered on the site, a report can be generated for daily, weekly, or monthly spending. What I did find, though, is that my $4 a day spending should not be for the work week, meaning Monday through Friday; rather it should be Sunday through Thursday because Friday and Saturday constitute my weekend. I would exclude Sunday because I usually go to church, then home to do chores and run errands. Therefore, my entertainment is usually on Friday and/or Saturday nights.

So, my total spending for the week was a whopping $39.57. This included spending my $4 free money everyday at work and having drinks and an appetizer at 'On the Border' on Friday night with the girls.

Another revolation for me, now that I am finally taking control of my frivolous spending, is that I need to include at least $20 a month in my budget for miscellaneous spending. In the miscellaneous spending category, I spent $3.85 to buy some handwipes, sanitizer and a small notebook.

I am SO proud of myself for sticking to my entertainment spending plan. I know that having this blog has made me more accountable. Even if no one reads it, it is my way of holding myself accountable--kinda like an online money diary.

These little tidbits of information are in no particular order, but I decided to put them in countdown order ('cause I'm cool like that). Following these simple tips has helped me almost reach financial freedom (I will be debt free, everything except the mortgage by the end of 2010)! So, yeah me! And YEAH to you also, if you are already following this advice or choose to implement them after reading this post.

10. Assests buys luxuries. We should not buy luxury items with regular income. If we desire luxuries, we should make sound investments, then use the money generated from said investments to by "wants".

9. Never take out a loan or pay interest on anything that depreciates. That beautiful new car you want--yeah that one--until you can pay for it cash, you should drive a used car and save to pay for it in cash.

8. Create multiple streams of income. Robert Kiyosaki calls it "having your job and minding your business". We should all have our full-time jobs and our legal side hustle.

7. Pay yourself first, and do it automatically. Most of us won't even miss the money if we never see it in our paychecks. We learn to live off of what we take home.

6. When you get a raise, don't raise your standard of living. That one bears repeating---When you get a raise DON'T raise your standard of living. Invest the increase instead.

5. Investing in any retirement program that provides a match is equivalent to getting free money. Where else can you get FREE money and who, in their right mind, turns down free money? Got it....good! Sign up for your company's retirement program immediately--if you haven't already--and invest up to the match amount.

4. Money is simply what we choose to trade our time for--that's all it is. We choose to give it more value and more power than it deserves by trading too much of time for money to buy material possessions that add no value to our lives.

3. Drive a paid for car! Enough said....

2. Debt is slavery. We are enslaved to anyone we owe.

1. Live below your means--the simpliest, yet hardest rule for people to follow.

You can improve your finances while helping the environment by following one simple rule:

REDUCE FIRST, Reuse second and Recycle as a last resort.