Thursday, November 20, 2008

Feckful frugality

Here's an article from today's Times about some of the contradictions of what I would call "early frugality," or losing the forest for the trees: buying too-large amounts from a big-box store, or a flat screen from Wal-mart rather than Best Buy, because you're getting a "bargain," or driving a long way to save pennies on a grocery item. Walking 8 blocks (NY, right?) to save a buck and a half on califlower at a place when the other things on your list are more expensive.

I think these are issue associated with "early frugality" because eventually people wake up to them - that clipping coupons for cereal that is more expensive is not actually saving any money:

As Americans attempt to perform cost-benefit analyses of their needs and behaviors, they are whittling pennies from cable bills only to squander dollars on gas driving miles to discount stores, or on coupon-spurred splurges for nonessential items, like Cheez Whiz or organizing supplies. Pinched by shriveled retirement and college accounts, battered by ballooning mortgage costs, rent and co-op maintenance increases, and hedging against the possibility that a job might vanish, some are practicing economies that may not deserve the name.
The Times, of course, tends to see these as cases of "feckless bargaining," and an opportunity to allow yourself that $4 Starbucks seeing as it's not really that much in the grand scheme of things. I also love this example of money being relative:

“In my book I tell the story of the $15 pen,” he said. “What if you were told the same pen cost $8 less at a store seven blocks away? You’d walk to the store, right? But if you’re buying a suit for $1,115, and the salesman says, Guess what, you can get the same suit for $8 less at a store seven blocks away, you’re not likely to take that walk.”
Well, I suppose that's true, but maybe I could raise my hand meekly to ask why someone who is trying to save money is buying a $1,400 suit?

Eventually, as I say, people wake up to these contradictions, and take the steps to resolve them - either by going deeper into Amy Dacyzyn-land, having a price book and organizing your shopping so that you buy things at the store that has them for the cheaper price, or even (gasp!) by doing without - or by ignoring them, giving up and basically giving yourself everything you want, the $4 latte, the $1000 suit, or the $4,000 big screen, under the "life's too short" philosophy.

I think there will always be contradictions in a simple lifestyle, in that there are things that people will buy that they don't "need" but that they really do feel makes life worthwhile. For me that's the Sunday Times. Whenever I talk about this in public, I get apologetic people coming up to me to say they'd like to be frugal but they don't want to give up X or Y. Usually where that goes is, if they can't give up X and Y, they aren't really frugal, so isn't it contradictory or hypocritical (the "h" word, as far as I'm concerned) to even try? They want absolution, but I can't give it to them. My answer is, go ahead, give yourself X and Y, but how about not getting Z right now?

Here are some thumbnail rules:
  • Driving a long way to save a little money probably isn't worth it. Spending a lot of time on something that doesn't save much money likewise, unless you enjoy the activity.
  • Be hesitant to buy something that you think is going to save money "in the long run." Chances are you really won't use it enough to get the perceived benefit.
  • Unit pricing (per ounce, for instance) works in big box stores as much as in smaller stores. Just because something comes in a bigger package, doesn't mean it's less expensive, you have to check.
  • No large ticket item can be considered "frugal." That doesn't mean you shouldn't ever buy it, but you shouldn't fool yourself into thinking you're getting a deal, even if you buy it at Wal-Mart.
  • Hey, here's an idea - get a few poker chips, and mark them with a L for "life worth living." Give yourself, say, 5 of them - for the year. Then, when you are planning an elective purchase, and you really think you can't live without it, you give up one of the chips. That way, "life worth living" doesn't become an endlessly open category. Because you know what - none of these things really make life worth living. And the realization of that, more than reversing calculator tape or saving a buck on califlower and all the other "hows", is really the "why" of the whole project.

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