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Thursday
Jan262012

The Austerity Plan

Image via coneslayerWhen Nicholas lost his job, we embarked on what we affectionately termed The Austerity Plan. Bascially, we stopped spending money - not just money on superfulous Christmas stuff - ALL money. 

We ate from our pantry. We checked out books from the library. We got very comfortable with what we already owned.

It's an intense experience. You realize how many times your default is to buy something. Buy coffee to get through the afternoon. Buy a piece of clothing you really "need." Buy a magazine you really want. Buy. Buy. Buy. At first, it was incredibly hard. It felt like all I was doing all day long was talking myself out of purchases. 

But then - like going cold turkey on anything - you adjust. It stops feeling like deprivation. You start to realize how much you actually need. You get out of the habit of spending. It even became a bit invigorationg watching the days that you didn't spend any money add up. 

Then, Nicholas got a job. 

We said we would stay dedicated to The Austerity Plan. I didn't really feel like I was missing out so I agreed. I was proud of myself for not shopping, not wasting, not spending. However, I've noticed over the past couple of weeks I've been making way too many exceptions to The Austerity Plan. 

First, we went out to eat. Then, we went out to eat again...and again. I bought a couple of books off Amazon. We purchased some household items we'd been putting off. Now, that we have money coming in it doesn't seem as imperative that we prevent any and all money from going out.

We pay a lot of good lip service to rededicating ourselves. We both confess our frivilous purchase and say, "I'm going to be better next week." And yet, The Austerity Plan continues to fade into the background. 

I try to remind myself of how good it felt not to spend. How good it felt to feel in control when it came to money, instead of constantly feeling guilty. But when I get the chance to eat out with a good friend or spend $5 for a small luxury, I can't seem to say no.

So, here I am again. Asking for advice. How do you stay dedicated to financial goals? Does anyone out there have the secret to consistent frugality? I'm struggling and I need some help.

~ Sarah Stewart Holland

Reader Comments (8)

What works really well for us is a cash-only system for variable expenses. We put a set amount of cash into a coupon organizer for Groceries, Eating Out As a Family, Misc. (for us that's postage, hair cuts, gifts, etc), and Fun. Those lunches with friends, magazines, fabric purchases, etc. come out of fun money, so I don't feel guilty. Ryan often uses his for book purchases on Amazon, matter of fact.

It took about four months to get the kinks worked out, and we had to tweak it last quarter because of higher food costs. I had friends who had been doing it for a while and helped give us tips.

It's simplified our finances tremendously.

January 26, 2012 | Unregistered CommenterMichelle

I had to chuckle just a little when I read this. We've been living in the same sort of Austerity Plan mindset for the last year. My SO has been unemployed for most of the last two years and I left my job when the baby was born nearly a year ago. We've been living off an ever dwindling savings. Of course, it's now tax time and because of some financial choices I made early last year, I'll be getting a decent chunk back from the IRS. I'm already daydreaming about buying that book I've been waiting to buy on Amazon (the one I've already checked and they DON'T have at the library or ILL), buying some clothes (I'm 20# under my pre-preg weight so nothing fits except yoga pants which is just not a good look all the time) and going out to sushi for my birthday. I know when we have a little more padding, I'll be inclined to spend a little more carelessly and will have to be really conscious about what we spend.

How I hope to avoid it is by setting up a very strict budget that will include some provisions for frivolous spending. The reality is that some of it is psychological; it feels good to spend a little money on ourselves, it feels freeing to have that extra cash in your wallet and hit up the coffee shop to treat yourself to a latte you haven't had in months. For me it helps shake off a little of the weight of being forced to be frugal (as opposed to choosing to be frugal). I just have to remember not to get caught up in it. So, my plan is to work in a small amount of spending money for each of us into the budget and try really hard to stick to that. Having it as cash helps you be more mindful of your spending too. Any other purchases maybe have a conversation with Nick about. It's easy to talk yourself into that cute top at the store, but maybe not so easy to justify the 'need' to your hubs. I'll be interested to see what other folks have to add to this conversation.

January 26, 2012 | Unregistered Commenterdanielle

The experience of being pretty broke the bulk of law school helped me view my spending habits in a new light. I really had to prioritize and somehow that's stuck with me, even now that I have far more income. My parents always set the example of living below your means and seeing how that has benefited them and me has really helped keep perspective. But for the little temptations that I face every day, I always stop to ask myself, is this going to make me XX amount of happy. Like, I see a skirt I love at J.Crew - is it going to make me a $120 happy because it fits perfectly,I feel like I could take on the world in it, and I've worn out other staples in my work wardrobe? If not, then no. I even ask myself that when I'm dragging in the afternoon and in need of something more than the green tea and hot coco I keep stocked in my office. I don't eat out that often, so I feel okay when I do that with friends, but I also make sure that we go somewhere with good food! I don't deprive myself and I do believe that people who work hard deserve to treat themselves, but I don't ever want that broke stress I had in law school again. I just try to think about how having a fat safety net feels way better than the temporary upper of a fun splurge.

January 26, 2012 | Unregistered CommenterMichelle

I can't really offer advice, just support. We also set up a cash only system and it worked really well when we needed it the most. For us it's the going out to eat and fixing up our 1974 home, which came with some hidden baggage. It really is hard. I swear it's harder with a baby, too.

We started because I quit my job as a special ed teacher to stay home with my dude. I started a daycare and watched some friends' kids. Then we discovered that we were almost breaking even because I had spent so much money on my classroom and just surviving the last year. And then we stopped being so careful about our money.

Our goal is to get back onto the cash system to save up for some important things. I got this really cute wallet on etsy (I know. I spent $50 on a wallet to help me budget.) http://www.etsy.com/listing/91276293/reserved-for-leslie
It helped me get motivated though. What really helped us decide to get back on track was having a heart to heart on our anniversary. We talked about the things we want to do to the house, the things we NEED to do to the house, and the places we would like to take Jack this year. Thanks for writing, inspiring, and being so candid. This post was the last little push I needed to suck it up and be a better budgeter!

January 26, 2012 | Unregistered CommenterLiz

I think any good budget includes a little fun money. When you know you have a little chunk that you get to spend on whatever you want, it allows for those fun little purchases without guilt, and also keeps you in check. That way you don't go overboard, but you do allow yourself a little fun.

January 26, 2012 | Unregistered CommenterJessica Hekman

I am definitely with you on this one! After having my baby, I knew I had to change my way of spending. What works for me is utilizing websites such as mint.com that helps you keep track of your finances and gives you a clear view of where your spending goes into i.e week by week/month by month. It has made me aware of my personal spending as well as helped me set financial goals for myself. As far as being consistent with frugality, I ask myself, "Is this something that I just want or is it something that I need?" I find myself putting that dress/snack or product back on the shelf once I got the chance to check in with myself. lol.

January 26, 2012 | Unregistered CommenterHolly

We use Mint.com to track our spending and it tracks and places all spending into categories, after a few months it is really easy to see where we need to spend less and the reality of our spending is crazy!

January 26, 2012 | Unregistered CommenterKristin S.

"If there's a will there's a way". I do really believed in this quotes, because if you really want to saved money, you will find ways not to spend, to be thrift.

February 11, 2012 | Unregistered Commenterhealthy pet food

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