Friday, January 30, 2009

Spend to Save

With costs rising dramatically, while income levels remain stagnant, I've found myself scouring the internet for ways to trim our expenses so that we can we can continue to live within our means - this seems to get trickier and tricker every month!  I feel like I have implemented just about every money-saving measure that doesn't cost money to implement.  Cooking from scratch using only whole, unprocessed food, drinking tap water, turning off lights, carefully meal planning, making soup stock from vegetable scraps, hanging quilts over the windows to keep out drafts, avoiding disposables, you name it, I've done it.  There are, however, some money-saving measures that we could implement, but it would mean some up-front cost. Things like switching to CFL bulbs.  The cost savings are fantastic, but you pay a pretty penny for a CFL bulb up front.  Here are some more examples of things you could invest in that would reduce your expenses over time:

*Insulation:  Insulating your home will not only make you more comfortable, but will save a huge amount of money in heating costs
*Caulking:  Relatively cheap, caulking around windows, doors, and baseboard trim will significantly reduce drafts.
*Smart Strips:  these are power strips that allow you to break the power supply to your electronics, eliminating "phantom power"
*Clothes Drying Rack:  I ran an online calculator through our local power company's website.  I figured I average 2-3 loads of laundry per day (including cloth diapers).  With the low end of the estimate, 2 loads per day, we are paying over $70.00 every 2 months to run our dryer.  Canadian Tire has a good drying rack for $55.00, which I balked at at first, figuring I'd wait for it to go on sale before buying it - but considering it would pay for itself in just over a month, it's a fantastic investment.  I might just go get it today.
*Replacing disposables:  While typically this can be done for next to nothing (by using recycled materials), there are some things you might have to shell out for, if you don't have any sewing skills.  Like cloth diapers, cloth menstrual pads, etc.  If you can sew, you can make these for free by utilizing things you have around the house.
*Sewing machine:  Speaking of sewing!  A sewing machine is probably the best investment I have EVER made.   This has paid for itself over and over and over again.  I make our own drapes, all things reusable, mend things, etc.  The other night I mended a hole in a brand new pair of Norah's pants.  She had fallen on the sidewalk the first time she wore them, and left a hole in the knee.  I cut out a cute heart out of fabric, appliqued it on, and it's as cute as a button - you'd never know it was there to hide a hole!  Perhaps I'll post a picture.  Anyway, the possibilities with a sewing machine are limitless, I could never imagine throwing away a pair of pants because the zipper was broken, or paying someone to put up a hem for me.  It's easy to teach yourself to sew, and a good starter machine could be purchased 2nd hand for less than $100.00.
*Rechargeable batteries:  We've been slowly making the switch.  Each month I try to purchase another pack, until we've eliminated our need for regular, throw-away batteries.  We've also tried to reduce the number of things we use that require batteries.  
*Clothes Line:  Similar to the clothes drying rack, we use our clothes line all summer.  I think we paid $50.00 for everything we needed to set it up, and it paid for itself in a couple of months.
*Wood Stove/Woodburning Insert:  We did this a couple of years ago, and again, it paid for itself quickly, probably within the first 2 years.  Burning wood is a little more work, but saves us a huge amount of money, and makes us less reliant on the wildly fluctuating price of oil.

I'm sure there are many others that I haven't thought of!  Since we use the Envelope Method for budgeting, I've decided to start an envelope called "Spend to Save".  Where to get the money to fund this envelope?  Start by finding one or two ways to save money this month that won't cost you a cent up front.  Take that money, even if it's only $5.00, and stick it in your "Spend to Save" envelope.  Maybe this will buy you a pack of CFL light bulbs.  When you realize the savings from your reduced energy costs, stick THAT money in the envelope, in addition to what you saved without spending a cent.  With THAT money, you could buy a couple of tubes of caulking.  If you kept going like this, eventually you would build up enough money to buy some larger things, like a sewing machine, or insulation.  Eventually you might have enough money to install solar panels on your house, or a wind power generator.  Just as the snowball method works for debt repayment (as you pay your smallest debt, you roll the payment onto the next smallest debt, and keep going until you're debt free), you could snowball your "Spend to Save" envelope.  Simply make a list of things you could buy now that would save you money in the long run.  Put them in order of the cheapest (CFL bulb) to most expensive (Solar Panels), and then start snowballing!  

What are some ideas you have for things you could spend money on now to save money later?

Friday, January 23, 2009

Once-A-Month Shopping: So Far, So Good!

Awhile ago, I wrote a post about shopping once a month.  We've been doing this for a couple of months now, and I'm happy to report that it's going great!  My mother-in-law bought us a small, upright freezer for Christmas, which has made it possible for us to store a month's worth of frozen food at a time as well.  This was really the last obstacle in my way of full once-a-month shopping.  My fridge-top freezer just wasn't enough to hold everything.  

The one thing I struggled with, though, was meal planning for an entire month.  It's rare that I make it through a week and stick to my meal plan entirely, let alone a whole month!  Often I will bump a meal into the next week if I just don't feel like making it, or if we get invited out to supper, or whatever.  Having a monthly meal plan really made it difficult to work around this. So my solution was to stock up on basics once a month, but continue to meal-plan weekly. Friday is my big kitchen cleaning day, and part of that entails cleaning out the fridge.  While I'm doing this, I make note of foods that need to be used up, and I use those to start the upcoming week's meal plan, combined with what's already in my pantry.  Then I finish filling out the week's meal plan by making a small list of fresh ingredients that I will need, as well as basic things like milk, cream & cheese, and e-mail it to my husband to pick up on his way home from work Friday nights.  In order to save some money, I'm trying to create meal plans based on seasonal foods, which means sticking to basics during the winter.  Lots of things like potato soups, lentil soups, stews, etc.  Also, I'm finding that I can store a month's worth of things like potatoes, onions, carrots, and garlic, without having to pick up more throughout the month.  In the summer, when the farmer's market picks up, we'll start using a wider variety of produce again.  We're also sticking to basic fruit that stores well during the winter, like apples.  

It's taken a bit of tweaking, but I've gotten a good idea of what quantities we need of each item. In my Handyshopper shopping list, I've started writing in brackets beside each item how many of that particular item I go through in a month.  If I run out of that item before the month ends (like vegetable oil!), I increase the quantity I have in the brackets.  Then when I make my monthly grocery list, I compare how much of something I have in my pantry with how much is in the brackets, and add to my list accordingly.  For instance, I usually go through about 8 cans of diced tomatoes.  So I have on my list Diced Tomatoes (8).  On grocery list day, if I still have 2 cans in the pantry, I add 6 to the list.  For things like toothpaste and shampoo, I've found the best solution is to always have a full package stored in addition to whatever is open.  So as soon as I open one of those things, it immediately goes on the list.  Same goes for toilet paper & paper towels (the only disposable things I still buy!).  If you want to try once-a-month shopping, I would highly recommend spending a month just tracking how much you use of everything (I wish I had done that first!).  Then you will be much more successful right from the start!  If you want to try it, but it's not financially feasible to buy a month's worth of food at a time, try sneaking up on it!  This week, buy a month's worth of toilet paper.  Next week, you won't have to buy toilet paper, so use the extra money to buy a month's worth of rice.  Doing it this way is a good way to gradually work your way into it, without having to have a month's grocery money up front.  

It might sound like a lot of work, but now that it's up and running it's really not!  I'm exhausted after my big shopping day, but it's so worth it to know that I don't have to do it again for another month.  Especially in the winter, when it's -25 with windchill, like today!  It's nice to know that my pantry is still pretty full.  It also insulates us somewhat against bad weather, power outages, etc.  If you're used to shopping every Saturday, and you end up having a big storm Friday night and you're snowed in for a few days, you might run out of food.  By storing a month's worth of food at a time, you greatly reduce your risk of this happening.  Even if we don't get out for our fresh food run, I could easily feed us out of our pantry and freezer for a few days, if not longer.  I think it's also saving us money, probably because I'm sending my husband out for the quick weekly trips, and not browsing the aisles picking up one or two extra things, which always adds up.  

Do you shop weekly or monthly?  I'd love to hear about your experiences, and what works for your family!

Monday, January 19, 2009

Making the Emergency Fund a Priority

I've mentioned before that we are focussed on getting our debts paid down as quickly as possible. Debt stresses me out, and I feel like until we get out from under it, we will always have a dark cloud hanging over our heads.  However, given the uncertain times we are currently facing, I have decided it would be more prudent to shift our focus to building up our Emergency Fund. Although it doesn't appear that my husband is in any danger of losing his job, it's not a gamble I'm willing to take.  Our debts are all at very low interest rates (even our remaining credit card debt is locked in at 2.9% and 3.9% for the life of the balance), so it's not like we're paying horrendous amounts of interest.  And our tax-free savings account earns 3% interest, so it's pretty comparable.  What it really comes down to is being able to sleep well at night.  Knowing that, if for some unforseen reason, my husband lost his job tomorrow, we wouldn't be homeless in less than a month.  I'm more interested in protecting ourselves than making the credit card company happy.  We will still continue to make slightly more than our minimum payments on all of our debts (minimum payment rounded up to the next $10.00), but then funneling any extra money into the EF.  Our goal is to have 6 months worth of living expenses in savings (which would actually stretch out to a year when combined with Employment Insurance).  It seems like a huge goal, but we're just taking it a month at a time.  Every time we hit another month's worth of savings in our EF will be worthy of a celebration!  Even if it takes us years to reach that goal (which it most likely will), it will be well-worth it.  We will then be able to take the money we were contributing to our EF and throw it at the debt (which will be slowly declining in the meantime).  I know this is contrary to the advice of most financial experts (who usually say debt repayment comes before savings), but I think these are different times we are about to be living in, and we need to protect ourselves.  Creditors are revoking credit lines, so as you pay down balances on your credit card debt, the credit card company is actually reducing your available credit right along with it, eliminating the option of using that credit card in an emergency.  In the past, people would always say that you should pay down your debt, and then you'd have your available credit to use in case of an emergency.  This is no longer the case.  Not to mention I'd rather not be dependent on a credit card company to save my family during a time of crisis, it totally goes against my desire to be as self-sufficient as possible.  I'd rather keep my debts at the low interest rates that we have, and beef up our savings, and then attack the debt with gusto, knowing that we have protected ourselves from financial disaster.  

Wednesday, January 14, 2009

An Economical Start to Cloth Diapering

Happy new year everyone!  I hope you're all well-rested after the holidays.  I feel like I'm still recovering...  or it could be that I'm in the final stretch of pregnancy and I'm just feeling more tired.  Sometimes I like to try to convince myself that I can get a million things done, even though my body is trying to tell me otherwise!  With only 9 1/2 weeks to go, I think my body is telling me to slow down and chill out.  :)  Meanwhile, my nesting instincts are telling me the opposite! I feel like there are still so many things to do before this baby's arrival.  So I made a decision that will make my life a little easier.  I was planning on sewing a full newborn stash of fitted diapers, but given that a) I don't have the energy, and b) They're only in the newborn size for about 3 months, and it seemed like a gargantuine waste of time, I decided to take the easy route: Prefolds and covers. 
I discovered that Bummis makes a cloth diaper starter kit, which includes 36 infant prefolds, 6 covers, and a roll of flushable diaper liners.  I bought it at our local Baby Company for $159.00, which I think is pretty good for 3 months worth of diapering! I likely would have spent twice that on disposables during the same amount of time.  The great thing is that prefolds are so versatile...  when the baby outgrows them, I can use them as inserts or doublers for the next-sized diaper...  they can also be used as burp cloths, or on-the-go change pads. I've heard many moms say they make great, long-lasting dust rags, and are wonderful for washing the car!  And they're unbleached, so no nasty chemicals.  I washed them 3 times in hot water  (to strip the natural oils out of them), and dried them in the dryer, and they fluffed up beautifully and are SO nice and soft.  :)  I bought a snappi, and a few dozen washcloths to use as wipes, so we're good to go in the diapering department!  I might make a couple of fitteds just because they're so stinkin' cute (I made one last night, in fact), but I no longer have the pressure of sewing a whole stash - now I can just sew for fun!  For the record, this kit also comes in toddler size - so if you have an older baby and think cloth diapering is unaffordable, this would be a great way to do it.