"Helping people fearlessly face their finances."

We’ve talked a little bit about the difference between being frugal vs being cheap.  The topic of value is somewhat related to this, but I think it is a bit more personal.  Living a frugal life is seen by some people as living your life and depriving yourself for the sake of saving money.  I don’t see things that way.  The frugal life is about using your money to buy things (in a loose sense; not necessarily physical things) that bring value to your life.  It is about being smart with your money and knowing what is a good purchase and what is not.

Shopping for baby can be really overwhelming because the number of different products and choices are seemingly endless. Having recently become a parent I’ve learned a lot about what you really need to help you take care of your child. Having a baby can either be moderately expensive to insanely expensive depending on how frugal or frivolous you are with your purchases. My husband and I want the best products that money can buy for our child, but we also want to be able to stash money away for his college education. I’ve put together a list of the things every new parent really needs to help them take care of their baby. The rest is all nice to have or fluff.

We’ve been a bit lax with our article writing recently.  A cold bug ran through the family and had us laid out for awhile.  We are all currently recovering and will hopefully get back to regularly publishing articles.  

In any case, I was going to talk a little bit about buying a car.  My wife and I purchased a new car last year, and I think we learned a lot about the process.  Let’s get a couple of things out of the way first.

I definitely have mixed feelings about 401ks.  For those that don’t know, a 401k is a (US) retirement account that became popular in the 1980’s to replace employer paid pension plans.  401k’s remain very popular with companies today, mainly because they are funded by the employee, not the employer.  

Benefits

The benefits of a 401k are pretty well known.  As mentioned above, employers like 401k’s because they shift the cost of retirement to the employee.  Many companies offer some sort of match in contributions that employees make to their 401k’s.  This is not required, therefore, not every company does it, and those that have different contribution rules and limits.  

My husband and I are HUGE readers, and we also watch more movies than we probably should. We used to buy books and movies almost on a weekly basis in order to keep up with our addictions. We spent way too much money, but we thought we were justified to satisfy our voracious appetites for books and movies. We were trying to keep up with all the genres we loved best, and ended up filling our home with piles of books and movies that were spilling out of bookcases onto floors. When we forced ourselves to take a step back we realized a few important things about our addiction. It was too costly to maintain, and we would never be able to get through all the books and movies we had purchased. While some addictions can be quit cold turkey neither of us were willing to forgo reading the new books by our favorite authors or never buying or renting another movie again. We found the solution to our media needs at our local library - free of charge.

There’s a big difference between someone who is cheap versus someone who is frugal. A frugal shopper tends to be savvy with their purchases and does research to make sure they are buying high quality items that will last a long time. The cheap shopper usually ends up spending more money over time for the same items, because they tend to buy lower quality products based on price alone. The frugal shopper buys based on a combination of an item’s quality and price. Frugals spend less money over time, because they buy higher quality products that last longer than cheap products. What kind of shopper are you?

This week’s Frugal Family article is for individuals as well as families.  I think anyone can benefit from considering how lifestyle creep may be affecting their finances.  So what exactly is “Lifestyle Creep”?  Lifestyle creep is the phenomenon where no matter how many raises you get or how much extra money you make, you never seem to have enough money to pay the bills.  More specifically, it is how our expenses always seem to get higher and higher as the years go by.  Fortunately, if you are aware of it, there are some things you can do to help limit the affect that Lifestyle Creep can have on your life and finances.

Valentine’s Day is a holiday that you either love or hate. Most people aren’t on the fence about this Hallmark holiday. I would have to say that I am of the latter persuasion, mainly because this is a holiday forced down our throats by retailers selling mostly overpriced, useless items. If you insist on celebrating this holiday (or your sweetie expects it) why not make this year’s gift thoughtful, useful, and affordable? After all, why spend a bunch of money on gimmicky knick-knacks that will end up being forgotten on a shelf, thrown in the trash, or recycled.

The main reason I am not enamored of Valentine’s Day is because it is another chance for retailers and credit card companies to make a fortune selling products that will end up collecting dust or being thrown into a landfill. In most cases, you end up throwing your money away in order to appease your honey because card companies and jewelers stress that it is mandatory you buy “romantic” gifts to prove your love. I’m here to convince you that you can prove your love by giving a thoughtful gift that won’t break the bank.

I watch a lot of TV.  Probably more than is good for me.  However, I don’t spend a lot on cable.  According to this CNN Money Article from last year, the average cable bill in the US is $75 a month, with an average annual increase of 5%.  Add in premium channels or packages (like HD programming and a DVR), and you can easily pay well over $100 a month - that’s $1,200+ per year just for cable.  That's a lot of moola.   And unless you are getting an average of 5% in raises every year (which I know I am not), then each year, the cost of cable vs your income is just going to keep getting higher and higher.  That is not something that I really like happening to my expenses, so here is how I deal with it:

Everyone has to eat, but how you go about it can drastically impact your finances. In order to save money and live healthier my husband and I  bring lunch to work, and we try to limit the number of times we eat out per week as a family. We also have some tricks we employ at the grocery store that not only help us make smarter food choices, but also help us to keep our grocery bills low.