How much money are you spending that you don't need to?

Over the years my wife and I have learned the value of sending less.  Now that may sound very simple, but when you look deeper it is profound.  One of the ways we stretch our money is to get great value for every dollar we spend.  We are a one income family yet manage to have a standard of living that some two income families can't manage.

How do we do it?  First thing is we have built our pantry to the point that now we only buy food when it is on sale.  We are no longer caught in the situation of having to pay full price for the groceries for supper.  We know what food items we use and what a good price is on those things and when we find them on sale we stock up on them (this alone effectively cuts our grocery bill by more than 30%).   We have also refinded  our dining cuisine to feature less expensive food items.  First and foremost  we stay away from prepared foods that cost way more.  Our goal is to keep the cost of food to less then $5.00 per day per person and that includes eating out.  Take note that I still have meat with most meals even at that price.  We also avoid the candy and cookies and potatoes chips and pop, as these are all very expensive and do not a meal make.  You can buy steak cheaper than chocolate.

Second, FORGET Fashion and NAME BRANDS, and go with practical and appropriate.  The jeans for $9.00 from walmart are just as good as the $80.00 brand name jeans.  Unless you are playing in the NBA you don't need $150.00 running shoes, (and neither do your kids).  Today I look as sharp as anyone else and for a fraction of the cost, pants from walmart, shirt from the thrift store (it still had the new tags on it $35.00  for $3.00) shoes on sale, my last two coats were bought at yard sales.


Third, read my recent post about not driving a new car.  You can save a bundle.

Fourth, we save a ton of money on things like cell phones (bought both of our cell phones at yard sales for less than $5.00 each) and have them on a pre-paid plan. We don't text and the cell phones are used sparingly and are often off more then on.

Do you really need 130 cable channels, 4 movie channels, pay per view sports?  You can function without a 64 inch HD LCD TV, really you can.

Fifthly, watch what you spend, things like gym membership, go for a walk instead.  Limit your eating out (brown bag it at lunch).  Turn off lights when they are not needed, like when there is no one in the room.

Think about what you spend and where you spend it, work on getting the best value for all your hard earned dollars.

Cheap_O Economics

Cheap-O Economic Returns

Cheap-O Economic Returns

It has been a year since my last post. During that time a lot has happened. In Feb. Of 2011 I suffered a heart attack, and had quad bypass surgery in May 2011. It took all that summer and fall to recover and get back to being able to function. The good news is that I am doing great and the surgeon tells me my heart is better then it was 20 years ago. For that I am very greatful.

Now I am going full strength and ready to pick up where I left off. I have a list of projects left over from last summer plus ideas and plans for new projects, more then enough to keep me busy for the whole summer.

I trust that everyone is doing great and that the economic climate is encouraging you to take the steps to necessary to regain control of your money and your economic future.


Gas Prices and Mortgage Rates Creeping Up

Every time I pull into a gas station it costs a little bit more to fill up. A few cents a liter or a gallon adds up by the tank full. We have seen gas prices at the pumps go up by more then 10 %. With the average family already spending $6000.00 per year on gas that extra 10 %, means they will have $600.00 less to spend each year on things like food and clothing. Given that the forecast is for gas prices to keep moving upward, there will be less and less money available for other purposes.

Don't forget that with increased transportation cost, businesses will pass the increase cost of doing business on to the consumer, which translates to everything will cost more.

Morgage rates are moving up as well. Royal Bank and TD Bank both raised there 5 year rates .20 percent and that trend is upward as well. The fact is that at some point interest rates have to return to a "normal" level.

Business analyst ate telling us that even a 2 % increase in mortgage rates would result in a significant number of consumers having to spend greater than 40 percent of their paycheck just for debt service. Add that to the increase in gas expenses and you can see that there is trouble on the horizon.

So how do you adjust to cope with this onslot. First DO NOT incur any additional debt, if you feel you have to have that new High Definition 54 inch LCD TV, wait to buy it until you have the cash to pay for it, don't put it on the credit card. Make a concerted effort to pay off your debts, starting with the debt with the highest interest rate.

Next drive less, I know that is easier said then done, but there are things you can do to cut down on the number of miles you drive. Walk or ride a bike, if that is not practical then organize your trips so that you are combing several trips into one.

A lot of money advisors would suggest getting a car that gets better milage, and that is a good idea, BUT not if you have to borrow thousands of dollars to save a few hundred on your gas bill. I own a. 1984 Dodge that I paid $500 for, I can buy a lot of gas, even expensive gas for less then making car payments. So make sure you are looking at the total picture when making decisions.

Automotive experts tell us you can save a lot of gas by following some simple rules. Don't let your car idle for any length of time, check the air pressure on your tires, slow down, keep your car tuned up, check your air filter often and keep it clean or replace it should it need to be changed.


Don't be like those people that have a bumper sticker that says, "I owe I owe it's off to work I go". Start now staking your claim to economic freedom. You should always be striving to reduce your debt, and reduce your cost of living. It can be done.

Cheap-O Economics

2011 - The Year Ahead

2011 we are all wondering what the year ahead has in store for us. We look back over 2010 and some of us are better off then we were a year ago, for a lot that is not the case. So what does the year ahead hold in store for us.

That is the Zillion Dollar Question. I have been reading the predictions of the political pundits and the Economists from the Right, the Left, the Center and some that are so far out they are not even in the ballfield, The one thing I notice, not a one of them has a clue, oh don't get me wrong, they can show projections, and charts, case histories, trends, but when it comes down to it, they don't have a clue, Even the best guessers are making less then good guesses.

So are interest rates going up, YES, they can't go down any further or they will be paying people to borrow. So once you hit bottom no place to go but up. The question is not if rates are going up,, but HOW much are they going up by. For a lot of home owners a 2% increase in interest rates would be devastating, a 4% increase would wipe them out. But you say, rates can't go up that much or that high, OH yea they can and have, check out the 19% mortgages that we around in the 1990's and how people walked away from their homes after their payment doubled, tripled or even quadrupled. My uninformed dumb luck worst guess, an increase in mortgage rates of about 2% by end of 2011.

The value of the Dollar??? Well the Canadian Dollar is a par with the US buck, and likely to be worth more as the year progresses. The US Greenback will suffer against other major currencies, BUT that could all change if one or more of the EU countries have a major meltdown and the Euro takes a hit.

Cost of Food and Fuel. Well given that China added 25 Million new cars last year and will add that many again this year and that India now has Middle Class population of 350 Million (roughly the same as the total population of the USA), the competition for quality food and protein will increase, and with more and more cars on the roads in Asia, the cost to the consumer of Food and Fuel is going to likely keep raising. Add to that weird weather, snow in Florida, floods here there and everywhere, who can even guess at how crop land and food production is going to be effected.

So plan on spending more at the service station and at Safeway, But, stores will have great specials once people are buying less, they have to keep their product moving and there are going to be some deals to be had. But you need cash on hand to grab those deals.

On that note, if you happen to have some extra money just laying around, there are going to be some great deals as stores dump inventory, as businesses go down the drain, as homes remain unsold (in 2010 there were more then a Million homes foreclosed on in the US those have to be resold to someone.), as luxury items are sold off by people reducing their debt and lowering their payments.

Employment outlook. Well in the US it is going to stay at the 10%+ unemployment range, and the longer it stays there the more and more people that won't be able to find a job. If you are a grad from college and you don't find a job in a year, guess what, next years grads are now looking for the same job you are. Statistically, the longer you are out of a job the less likely you are to get a job. Now there are a few Bright spots out there. Western Canada (not counting BC) is healthy and Saskatchewan has lots of jobs available. The clean up in the Gulf is going to create jobs. Major urban areas of the US, well don't hold your breath.

Then of course what are the political leaders in Washington, London, Ottawa, Mexico City and the other capitals going to do? Mess things up, of course. Do the worst possible thing, of course. Make matters worse, for sure. The one thing political leaders and their advisers forget is that all the theory and all the great plans won't work if no one can figure them out, and people are going to do what is in their best interest.

My suggestion, the same as it has been for the past couple of years. REDUCE, Reduce your monthly cost of living, reduce your debt, pay everything off, spend less, buy less. Reduce your dependence on a job.

DO grow your own food or at least some part of it, DO stock up on food when it is on sale, DO evaluate if you really need that gym membership, cable TV, Cell phones for everyone, 2 or 3 cars, a house that big.

Don't spend money you don't have, Don't use your Credit Cards for everyday living expenses, Don't incur any more debt, put off buying that new car or truck and NO you do not need or have to have that new wide screen LCD HDTV, or that new IPhone or that new whiz bang toy, Don't pay other people to do things you can do.

Oh and by the way, I don't have a clue, anymore then the rest of the people making predictions, my best guess is bases solely on what I see out the window and from making up my own mind after perusing the vast array of options expressed out there, BUT I do know that having taken the steps we have I can ride out things a lot better then most people.

Happy New Year
Cheap-O Economics

Can Your Wallet Survive Christmas?

Christmas is that time of year when the sound of Christmas carols is mixed with the beeping of cash registers. When Visa and MasterCard are processing hundreds of transactions a second, every second of every minute all through the Christmas season. When 60% of the years retail sales take place. Where every business is after your money with commercials showing cars gift wrapped and furniture that you can pay for 15 months from now, and the latest “hot item” that everyone has to have.

What can you do to protect your wallet?

First, put away your credit cards. Decide on how much you are prepared to spend and then use Cash or your debit card so you do not spend more then you planned. Don't forget that wrapping paper and postage are part of the cost of Christmas, so make sure you take that into consideration.

Next, rethink your gift giving. It really is true that the thought is what counts, often a small box of candy is as meaningful as a expensive “not sure what to get” gift. You should take a look at your gift list, you can suggest that the family and work draw names and set price limits for giving. It is great fun to hunt for the perfect 10 dollar gift.

You can keep a handle on your spending. It is possible to have Christmas without Tickle Me Elmo or 42 inch LCD HD TV or Xbox 360 or what ever the “have to have” gift is this year. NO your kids physic will not be damaged if they don't get everything on their wish list.

Shop early so you avoid the heavy weight Christmas marketing action. One of the best ways to not spend money during the holiday season - Don't go to the mall! Pick a time for doing your Christmas shopping and then make an effort to stay away from the stores after that. We are finding more and more that we can pick up just that perfect gift for that special someone during the year and tuck it away until Christmas.

Mostly remember that the Joy of Christmas is not buy, buy, buy. The Joy of Christmas is time spent with family and friends. The cherished moments of a new grandchild's first Christmas, where the wrapping paper is more fun then the toys. The time spent putting up the Christmas tree and getting those lights just right. Then hot chocolate and Christmas carols as you watch the lights shimmer.

This year enjoy Christmas without fainting when you open the January credit card bill.

Cheap-o Economics

Turn It Off

Turn it Off.

Yes that is one of the best ways to save money. Turn the lights off when you are not using them. Turn off the TV if you are not watching it. Turn off the computer at night, you can actually damage the batteries on your lap top if you leave it plugged in all the time, as it is in charge mode when plugged in.

Don't just turn off the TV. unplug it or at least use a powerbar so you can totaly shut it off. It will use up to 85% of the power when turned off (it is really in standby mode not shut off) as it does when turned on. The same goes for the VCR / DVD / CD player, you have unplug them to fully shut them off.

When I visit friends I am amazed to walk through the house and find lights, radios, tvs, and a host of other electronic items turned on ....and no one around useing them. My grandkids seem to think that you have to have the light on in the bathroom - in the middle of the afternoon. You can manage very nicely without the lights on when the sun is shining and it is daylight.

I wince when I see houses with all the outside lights on, and lights on in every room of the house.

As a society we take electricity for granted and only think about the cost once a month when we pay the power bill. Well our local power company has announced that in order to meet increased demand and the capital cost of replacing old equiptment and upgrading infastructor, the cost of power is going to more then DOUBLE over the next ten years.

It is time to really take a serious look at how you are using power, the ways you can cut back on the amount of power you use.

Things you can do to decrease your power usage.

Turn off the lights
Use Compact bulbs Fluorescent or LED lights
Use timers or motion detectors on outside lights
Use power bars to totally turn off TV, DVD, CD, microwave, and other electronics
Do you really need that many TVs?
Eat by candle light
Set your hot water tank temp lower
If you are buying new appliances look for Energy Star ones that use the least power
Turn the heat in your house down a couple of degrees

Everything will add up as savings for you.

Cheap-O Economics