When Thomas Paine wrote, “These are the times that try men's souls” back in 1776, he started a revolution. Well those trying times are here again; is it time for a new revolution?
Each day the headlines deliver more bad news: “Barrel of Oil Hits Record High,” “Food Prices Jump,” “Utilities Seek Price Hike,”” Housing Market Hits Record Low.” The list goes on and on.
Thomas Paine delivered more than just dire predictions in his revolutionary pamphlet Common Sense ; he delivered answers. “The harder the conflict, the more glorious the triumph,” he wrote. “What we obtain too cheap, we esteem too lightly: it is dearness only that gives every thing its value.”
It is not easy to live a full life on half the price, but it is possible with common sense, sacrifice, and a little know-how. In the next few months we shall explore with you all the possibilities of living on less.
How often do you walk through a parking lot and find a shiny penny staring up at you? If a penny falls from a pocket, no one misses it, right? But 100 pennies add up to a dollar and 500 to five dollars and a 1000 to ten dollars. The secret on living on less is to realize that “a penny saved is a penny earned” — just another bit of common sense from another Founding Father, Benjamin Franklin.
Columnist and financial advisor Brandon Drury reflected on old Ben Franklin's wisdom:
National statistics do little to encourage today's families. They paint a picture of increasing pressures and mounting skepticism. In the first four years of this century, median household income declined by 3% and the percentage of households earning a middle-income ($25,000-$99,000) declined by 1.5%. The savings rate is shrinking while inflation is growing.
Data from the most recent Consumer Price Index shows that in the past month food has jumped 5%, transportation 7.2%, and energy has sky-rocketed by almost 16% from April to May, 2008. No wonder most of us are worried.
The good news is that you are not totally helpless; there is still much you can do. Are you aware that financial experts estimate that the average person wastes 16% to 23% of his paycheck each month? That adds up to a whole lot of pennies!
What might you do if you were able to tap into even a portion of that? Would there be enough money to pay off some debts? Build an emergency fund to pay for a car breakdown or a broken washing machine? Could you take care of a leaky roof or pay for a child's college tuition? Or what about taking the vacation you always dreamed about? You are more in charge than you might think! A penny saved adds up to a dream realized, and you and I have lots of dreams.
One day a man came in to his bishop discouraged over his dire financial situation. He was a hard worker, but his paycheck was unable to keep pace with his growing family.
“There is nothing more I can do,” he said sadly. “I can't make it another year.”
His bishop asked him to describe his typical day to him. “Where do you go? What do you do? What do you buy?”
“If you are suggesting that I am not careful, I can assure you that I am doing all I can to keep my expenses to a minimum.”
“Indulge me,” the wise bishop said, “take this paper and a pen and write down for me everything you buy for just one week.”
At the end of the week, the man reported back to his bishop and they looked over his expenses. One item stood out because it was a daily expense. Each morning before reporting to his construction job, the man stopped by the local convenience store for a few treats— just a few cookies, a big drink, and a candy bar or two. At lunch he went back for a refill and on his way home from work, when he was absolutely famished, he stopped a third time.
“Do you think you might cut down those trips to the convenience store?” the bishop asked.
“Bishop, you don't know what you are asking. This is how I keep going.”
“Try it for one month. Cut your trips to once a day and see how much you save.”
The man went off with a shake of his head, but he tried the experiment. In one month he saved $300. He could scarcely believe it.
“Now,” said the bishop, “take your $300 and begin to pay off your debt. Do it this month and the next month and the month after that.”
You can do the same. For the next week keep a notebook handy to write down every penny you spend. At the end of your experiment, gather your family together and take a good look at your list. Can you spot some waste? If not, look again!
Where do you spend most of your money? On food? Utilities? Gas? Housing? Have you bought anything this week you absolutely did not need? If not, look again. Everyone has waste. You'll find something if you look long enough and hard enough.
Now try cutting just 10% out of your budget for next week. You'll do it a dollar here and a dollar there, but my, how those dollars add up. Maybe it's as simple as having homemade soup or homemade bread or tuna casserole once a week. Maybe it's taking a brown bag to lunch.
Maybe this week you'll walk to church or school or you'll ride the bus to work or maybe you'll carpool just one day next week. You'll be surprised how little you'll miss whatever you sacrifice. Little cuts never affect your lifestyle, but they do affect your buying power. You'll find money for shoes, clothes, or even for the pay down of debt.
A dear friend of ours had a job as a school bus driver. His paycheck was small, and he and his wife lived in a trailer with a whole lot of debt. He got out a notebook, wrote down his expenses, and went to work. Within a year he'd paid off all his debts and had enough money left over to put a down payment on a house. If he could do it, so can you. You just have to believe.
So go ahead — congratulate yourself. You've just taken the first step to living on less, and you are already well on your way.
