Monday, October 13, 2008

Recession tips: Ten ways to stretch a dollar

Never mind how we got here. The real economy is constricting and some analysts expect three consecutive quarters of falling consumer spending -- unprecedented economic gloom. And that's alarming. But folks just don't have the easy credit necessary to keep spending for the sake of the country -- the kind of "patriotic", idiotic spendthrift behavior urged by our president after 9-11, and practiced by the Bush administration to this day. As the credit/mortgage/derivative/credit default swap ponzi scheme unwinds, a lot of people are beginning to understand the limits of the real economy on the ground. If most people actually attempt to live within their means, the economy will most certainly constrict. But the real economy is still the real economy. You have to eat and clothe your family and find shelter. Wheels may be an add-on for some, a necessity for others. So here are some thrifty tips from some one raised by Depression survivors. Thinking of it as a lifestyle choice and making a game of it can help.

1. Never pay full retail. You don't need anything bad enough to pay full retail in this economy. The thing you are looking at is not the last one on the planet. If you really need it, shop around. Or ask the seller if they'll come down in price. You can do this. The worst they can say is 'no.' And you can still walk away and shop around.

2. Pay cash, if possible. Ask if there is a different "cash price" than the price marked. You'll be surprised. And by the way "cash" means cash, not debit card or personal check. This can be a great way to get back at the credit card companies for charging merchants a percentage while charging you interest. The credit card companies make a alot of money off your transaction. Their merchant fees effectively inflate prices for everyone. So pay cash and stick it to them.

3. Buy non-perishables in bulk when they are on sale. Yes, that means you will be the one with 40 rolls of toilet paper at the check out. I recently spent $40 on $65 worth of contractor bags because the price was unbelievably good. I'm set for about 16 months. No harm in that.

4. Save gas by batching your errands. Take the time to plan a route for your errands and do them all at once. It takes a little thought, but it'll give you more uninterrupted free time the rest of the week.

5. Buy some of your clothes used. I know, this may seem beneath some of you. But you can make it tolerable by thinking of the Thrift Store as your cousin's closet. Didn't you trade clothes with your cousins when you were a kid? "Hey, Carol, I love that top. Can I borrow it?" No shame in that. Ann Arbor has an amazing Salvation Army. University of Michigan students love it for vintage clothing. It's cheap and chic. Don't be afraid, all the smart kids are doing it!

6. Focus on function and price. Think carefully about the functional need you are seeking to fill. Ditch bells and whistles if they drive up price. A car is a means of transportation, not a second home. A wristwatch lets you know the time; most of us don't needn't it to function at the bottom of the ocean, really.

7. Use the public library for your entertainment needs. Ann Arbor has a kick-ass public library with vast dvd and music cd collections (not to mention all the latest books). People in town pay an annual tax to sustain and grow it and at a little over $100 per household it's a crazy bargain. If you live outside Ann Arbor, you can pay an annual user fee, still a crazy bargain.

8. Share large tools with your neighbors. Get together with neighbors to save money on large tools like rototillers, wood splitters, extension ladders, power washers, snow blowers, chainsaws, etc.

9. Plant a garden and learn to can stuff. What you grow will be fresher and tastier and cheaper than anything at the supermarket. You will know where it came from, who picked it and how it was fertilized. And you will remember, in your deep archetypal self, that you are fundamentally a child of the Earth.

10. "Use it up. Wear it out. Make it do or do without." I learned this from a lovely woman who was just a child during the Great Republican Depression of the 1930's. The idea is to spend only when necessary -- an idea antithetical to the easy-credit mentality of the last twenty years.

Good luck, campers.
More later...