For most adults alive today, we are currently in the second, or even, third serious economic crisis of our lifetimes. Yet surprisingly, despite having plenty of experience, it would appear from the buoyant frugal living industry, that many people are still lacking the skills to thrive, or even survive when economic cycles hit the doldrums.
The old adage says: “Take care of the pennies and let the pounds take care of themselves”.
A wisdom that has transcended the ages. One which, if we all followed it, from the private citizen, to the largest global bank, there would be far fewer people suffering the effects of the current financial rag-order.
Current global affairs are demonstrably woeful, but it profits us not in any way to restate this. Let us instead consider the best way of proceeding in order to be prosperous (the way we previously identified).
We needn’t look far for volumes of ‘advice’ on the matter, some of it good, some bad, and lots of it extremely expensive!
However, to find a distillation of the principal we ought to apply, we need look no further than to the legendary debtor, Charles Dickens’ Mr Micawber.
In Chapter 12 of “David Copperfield”, he has this advice for our eponymous hero:
“Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
How then, do we, the average individual, best improve our family’s finances and thereby, their quality of life?
Fortunately, with sufficient organisation and drive, this is neither difficult, nor expensive to achieve. With enough creative thinking, the possibilities are endless, but in the meantime, here are some tried-and-tested favourites that you can try within your own household and immediate community, to start you off.
No matter where we are in the World, it is important to consider where the material things of our life have come from. The more local the source, the less costly in both money and resources, the more we save. Annie Leonard demonstrates this in a simple, fun and visual way in “The Story of Stuff.”
Working on a seasonal basis, also helps to cut costs of end products to you as a consumer and cuts environmental and socio-economic costs to the World (which ultimately rewards you the consumer with a drop in the cost of living). So learn what resources and products are locally available to you by seasons. Our planet has its own innate ways off supporting life all over the globe on a local scale, if only we’ll let it. The beauty of this is, it doesn’t take much, just a little common sense. For example, if it’s mid-December and you are in Northern Europe, buying strawberries is expensive in cost and resources. Far better to pick strawberries locally (perhaps in your own garden) when they are naturally there and preserve some if you want them in the winter.
Reuse, reduce and recycle
Part of the problem with the “system” as it stands is that it is linear and finite. By applying “The Three Rs”, which means more than just separating rubbish and taking it to official facilities, it means finding alternate uses for stuff that decreases our reliance on consumerism to solve our problems (eg. re-use off food tubs for home storage), we decrease our expenditure and our impact on our planet, which saves us in the longer term.
Coupons, vouchers and deals
While the best possible action for us is to reduce gradually our dependence on consumption, in the meantime, we can change and manage the ways in which we consume. We can exploit companies’ desire for our custom by taking advantage of coupons, vouchers and deals when they come up, but only after we assess them to see whether they are good for us.
For example, a large supermarket in your town is reducing all of its meat this week. That’s great, you can get all your meat cheaper, instant saving. Fabulous for you, except that, the store is relying on consumers to be so excited about this deal that they will come through the door and then do the rest of their shopping here too “because we’re here” or “because I can’t be bothered/I’m too tired/haven’t time to go across town for the rest of my shopping”. So we don’t notice, or in the moment we forget, that the competitor across town is far cheaper on produce. The store makes extra revenue that week which covers the loss on the meat and we are all a little poorer for having spent out extra on produce as a trade off for “convenience”.
Collecting Vouchers and coupons alone can also be tricky. If we are indiscriminate in our choices, we may end up buying a product we wouldn’t normally, just because of the offer, or we may end up buying a less cost efficient size of product because we perceive a saving. For example: A brand of nappies offers coupons at 50c off the marked price on the 30 units pack price. Without further information, we might think that a good offer – after all, we’re saving ourselves 50c and that has to be good, right?
Well, it is, until you discover that in that 30 nappies pack that they are encouraging you to buy, an individual unit costs 20c each (pack price €6), whereas, if you were to buy the bigger, 100 unit pack (cost €10), an individual unit costs 10c each, so if you had ignored the enticement and opted for the bigger pack without the deal, you would have spent out €4.50 more (including the 50c saving on the coupon) but you have actually saved yourself €10 over the period that you would use 100 nappies in, because the unit cost was lower. So the lesson is, be extremely careful when using coupons, vouchers and deals.
However, it is also worth pointing out that an offer without any valuable outcome to you, may have some value to another member of your community. For example, the elderly widowed gentleman who received that coupon for nappies in the newspaper, may be tempted to just throw it away (another thing companies are banking on – they want as many people as possible to see how “generous” they are being and feel good about their brand, but they don’t really want everybody to avail of it all at once, as it hurts their profits if they do) BUT, if he swaps that coupon at a community swap meet with a young parent across town, who hasn’t enough money to make the saving on the larger pack, he is truly helping that parent save 50c, which for them, could be the difference between managing to cover the rent AND keep the family this week.
Creativity, community and organization
No matter how good a grip we get on any of the above areas in isolation, we will only truly begin to see more exciting and larger scale changes when we get organised, get together with our communities, and get creative.
By working together with our immediate community, not only does everyone do better (which alone is a good thing), but it can translate to more contentment and stability in our local economy. This reinforces our buying power locally and allows us to prioritise keeping our limited wealth local. Local producers do better and that translates both to better deals for us and for those local producers to increase their buying power, etcetera and so it continues.
However, that would still be a linear structure. To be truly self-sufficient and prosperous, we need closed or “loop” systems. Sustainable energy, low impact systems with an emphasis on staying local, better use of resources.
Example: the community garden needs a new planter. -> They go to the local publican who agrees to give them his 2Ltr empty soda bottles (He saves because he doesn’t have to pay to dispose of the bottles). -> The project acquires the bottles as a gift and saves money they would otherwise have spent driving to the nearest big town to buy a planter from a big store (who have no interest or real input on a local level) and the bottles get built into a planter. -> Having the new planter means they can use some of the saved money to buy extra seeds and plant more. -> This generates a bigger crop and the scheme is able to support more of the community. -> The community has less need to rely on outside itself for crops, so has a little more available money to invest in community projects like the garden. -> The garden commits to producing more. -> The cycle completes and restarts.
So with a little ingenuity, big savings can come from extremely little things.