Updated on 10.16.07

Your Money or Your Life: Ten Sure Ways To Save Money

Trent Hamm

YMOYLThis is the sixteenth part of The Simple Dollar Book Club reading of Your Money or Your Life. Want to know more?

Let’s move through these ten items one at a time.

1. Don’t go shopping
If you’re not going to a retail outlet in pursuit of a specific item, don’t go. If you do, you are literally choosing to spend money completely without necessity. Avoid shopping as a social or entertainment excursion at all costs. I have this very problem myself, actually, particularly when it comes to bookstores. I tend to enjoy going into bookstores, browsing for hours, and then often buying a book or two that I don’t actually need, even when there are several books at home just sitting there unread.

2. Live within your means
In other words, wait until you have the money to buy something before buying it. This is often more difficult than it seems, especially when you’re transitioning from a “buy in advance with a loan/credit card” mode to a “pay for it in cash” mode. Take our experience with vehicles, for example. We bought both of our current vehicles with loans and would like to not repeat the mistake with the next batch of them. That means as soon as we paid off the first ones, we started socking away money immediately for the next ones. While it’s nice to watch our savings balance rise and now there is light at the end of the tunnel, it’s a bit sad to know that we’ve been effectively lassoed with car payments for years.

3. Take care of what you have
This goes from hygiene (taking care of our bodies) to auto and home maintenance (taking care of our stuff). Doing these things extends not only our own life, but the life of our things. Little things, like getting your oil changed or dusting off refrigerator coils or cleaning out our vacuum cleaners or any number of little tasks can do wonders for extending the lifespan of the stuff we have.

4. Wear it out
This is a philosophy I strongly agree with. Don’t just replace an item because you want a new one – wait until you have a real reason to replace it. Drive your automobile until there’s significant issues with it. Wear clothes until they look noticeably worn (and this takes a while for a strong piece of clothing). Heck, reuse junk mail envelopes for lists (I use them in my GTD inbox all the time when jotting down stuff that needs to be done at home). However, don’t keep at it until it annoys you – be willing to accept that something doesn’t work and move on with it when something begins to wear down or actually break.

5. Do it yourself
I try very hard to live by this maxim, but sometimes it’s more difficult than it seems. For example, recently I gave replacing my kitchen sink faucet a shot and it ended with a plumber in my home. The key is to try to do it yourself – you’ll usually learn something in the process and who knows? You might just fix it yourself and save the cost of a repairman.

6. Anticipate your needs
Many people find that their monthly budget is “wrecked” by an unexpected expense, but quite often that expense could have been predicted or at least been somewhat blunted by the presence of an emergency fund. This is particularly true when you’re aware that an expense is going to occur – when you see your tires starting to show some wear, that probably means that a tire replacement cost is coming right up. A well-constructed emergency fund can really help with this. Just budget a certain amount each month to put into an emergency fund, then try to avoid using it until a major cost comes along.

7. Research value, quality, durability, and multiple use
Basically, look at total cost of ownership when investigating an item, not just the up-front cost. It’s fine to pay more for an item that will be reliable and durable over the long haul, does its job effectively and efficiently, and has a longer lifespan. It is this logic that often points towards buying more durable but more expensive automobiles and appliances.

8. Get it for less
This section blatantly pre-dates the internet, but the general maxim is still true. Look at lots of different places where you could buy an item and then go for the one that’s cheapest (but still secure). I usually am very slow with a major purchase, watching prices carefully to see if it’s an item that goes on sale regularly – and then I pounce when the opportunity comes. This doesn’t really take much time if you just look for a specific item once a week, and it can save quite a bit of cash.

9. Buy it used
Be willing to own and use things that have been used by others, particularly clothes, toys, books, and automobiles. Many people get rid of these long before their lifespan has expired, so don’t be afraid to get the remaining value out of them at a very inexpensive price. Yes, this does mean hitting garage sales and thrift stores – check your ego at the door.

10. Follow the nine steps of this program
Wow, a paragraph of promoting how good the book is! Skip.

Tomorrow, we’ll continue chapter six, “The American Dream – On A Shoestring,” focusing on the first half of the section “101 Sure Ways To Save Money.” This section appears on pages 181 through 197 in my paperback version of the book.

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  1. rita says:

    I can relate with the challenge of going into a bookstore and coming out again without buying any. Temptation…sigh
    It’s a good thing I can speed-read, I end up finishing the book right there on the shelf. If I think that it is something I would like to read more than 3x (which rarely happens), that’s when I buy it. Or put it in our choir’s Christmas wish list =)
    I do make it a habit to browse through 2nd hand stores, especially for books and clothes. I have lost count of the out of print books and vintage clothes that I’ve unearthed there.

  2. Oswegan says:

    Most overlooked way to save money in America:

    #2 Live within your means.

    In other words – act your wage.


  3. Oswegan says:

    Sorry, forgot the credit for that saying.

    “Act your wage America” is a phrase that Dave Ramsey often uses on the radio.

    I am going to see Dave live in Portland on Thursday – Yeah!


  4. lorax says:

    All these steps are great financial (and typically ecological) advice. These used to be common sense, but I guess those got lost somewhere.

    Consumerism is the entitlement of the current generations. Thanks boomers. :)

  5. Beth says:

    This is a great list. My father, brother, and sister have all asked for cds/dvds for Christmas and specified that a used copy was completely acceptable. I might even take them up on it!

  6. Avlor says:

    I’ve been practicing many of the “steps” for a good while. But I’ve been rediscovering the 9th one, hitting the used clothing stores and utilizing our local Freecycle list. (I’ve been giving quite a bit away as we go through our house, not just receiving.)

  7. Susy says:

    Not shopping is perhaps the best one. Once you quite shopping for fun, you realize you don’t need stuff. Then it almost becomes a chore to go shopping.

  8. rhbee says:

    My favorite way to not shop is to spend month’s looking for the perfect gifts for the people on my year’s gift list. Sometimes I don’t even know someone is on my list until I see something that suddenly is the perfect fit for so and so.

    My second favorite way to not shop is by helping somone with a task so that they don’t have to buy the help the help to get it done.

    My third favorite way to not shop is to listen to internet radio and avoid the downloading offers.

    You get my drift?

  9. Actually, this all boils down to “live within your means.”

  10. Trent Hamm Trent says:

    Spot on, Nickel. It’s just more specific ways of doing just that, no matter what your means happen to be.

  11. PersonalFinance - 1WealthBuilder says:

    Why is it that the simplest things to do are the ones we have the most trouble with?

  12. Gaida says:

    I shop fortnightly to every 3 weeks and really save money. Also combining your trips to save on petrol & wear & tear.

    Before my son throws anything out… he has a go at me and asks if I’m sure I can’t use it for my craft or something else.

    I’ve noticed my son’s been heading to the Mall more these days & he has been going through his money very quickly. But of course any suggestions I make are quickly shot down.

  13. Money Socket says:

    I think doing things yourself pays off big time. Ever since I learned website/graphic design I saved thousands in expenses for my websites and marketing. I had recent success with some remodeling work, and I’m going to try to tackle car repairs and basic maintenance next. DIY saves thousands upon thousands through your lifetime and it also gives you a great sense of accomplishment…or maybe thats just a guy’s whole macho pride thing lol. Anyway, nowadays with the internet you can pretty much get DIY info all over the web, so its definitely worth trying out, even if it does end up with a plumber to the rescue..If you don’t try you’ll never know if you can do it.

  14. Gaida says:

    Hi Money socket, I also learnt webdesign & have also saved so much money working on my own sites and helping others.

    Think I’ll shy away from the plumbing as it could end up costing me more in the long run.

  15. Steve says:

    About saving up for a car versus buying it on loan. Saving isn’t always better. The key is the APR on the loan, isn’t it? If it’s lower than the average return on your investments, it makes no sense to dump all the cash into the car. It’s about the opportunity cost of money. You can come off better if you invest it at 5% interest and pay off a loan at 3% APR.

  16. J. says:

    I don’t seem to have trouble with window shopping, especially bookstores, which I love to browse. Why not? I always carry a notebook & pen (one of your favorite tools, Trent), and write down stuff that interests me (I do this in cookware stores too). In both cases, I commit to buying absolutely nothing while I’m there (knowing how overpriced most of the stuff is makes this easy for me). Some of you should maybe leave home w/o cash or any sort of credit card.

    In any case, when I get home, I can reserve the interesting books at my library online (it helps having a great, big-city library system available), and research the cookwares that grabbed my attention. In the latter case, I usually find someone who can use a cheaper implement to do the same cooking job better.

  17. sunshine says:

    Correct me if I’m wrong, but I bet you could get a discount on the car purchase (or any major purchase) by paying cash. That might negate the benefit. Plus – 3% car loan, not everyone with so-so credit can get that APR.

    I like the idea of this chapter – living within your means. I am trying so hard to get the missus to do that.

  18. Laura says:

    Learning to do somethings yourself is very helpful not only for yourself, but it can also help your neighbors and friends in a pinch.

  19. James says:

    Your bookstore example sounds a topic that can be discussed on its own.

    I’ve talked about something like this with some of the guys at work too (some of whom also read your site), and I think that like you, not only are we ‘hoarding’ books that we don’t consume, but all kinds of other media, such as e-books, music, movies, etc.

    The electronic ones seem less tangible, so spending money on them is even easier. I think I may be overspending on books because I’ve been brought up to believe that spending money on information is an ‘investment.’

    Also, after years of spending $100+ per textbook at college, a $39.99 price tag can seem like a deal.

    Most magazines, IMHO, are just pornography for your hobby.

  20. Debbie M says:

    I have trouble with #3, take care of what you have. This is because I don’t really know how. Trent has talked about taking care of your car and house, but what about everything else?

    For example: books. Here’s the first page that popped up when I googled “caring for books”: http://aic.stanford.edu/library/online/brochures/books.html. It goes more overboard than I’m really interested in, but I do take some things from the page. 1) Store your books perfectly vertically (or horizontally) because it’s easier on them. This may mean you need book ends. 2) Leave some space behind books on shelves (if possible) for good air circulation, but push them a little way back from the front to protect them from the worst of the dust (and so that you can see evidence of bugs or other problems). 3) Use (acid-free, ideally) paper for bookmarks, not leather which can stain, metal, which can be rough on books, or even little yellow stickies because they leave traces of adhesive behind. (I like to cut up pretty greeting cards that I would otherwise be tossing and leave a stash in various places around my house.)

    I once went to a class on book repair, and the answer to almost every problem was white glue! If you can figure out a way to glue tears (use waxed paper to protect neighboring pages), glue pages back into books, glue bindings back onto books, etc., then you may as well do that.

    Also, when I’m dragging a book around with me everywhere, like a language learning book, I’ve finally learned to put a cover on it.

    Another thing I’ve thought about is keeping books off the bottom shelves in case of flooding (caused by rain or plumbing problems). Of course most things that I store on shelves would be ruined by flooding, so I haven’t worked out what to do about this yet!

    Similarly, #5, do it yourself, is difficult when I don’t know how to do anything. One cool thing I’ve learned is that if an appliance breaks, you can often google instructions on how to diagnose the problem, find the parts, and fix the problem. My boyfriend and I have fixed our washer a couple of times this way very cheaply.

    It really is amazing just how little we do ourselves. Basically every time you pay for something, you’re paying someone else to do something. I don’t want to do everything myself (I’m too weak to do plumbing and I’m happy to let others construct the computer chips I use), and sometimes others have much better equipment and better efficiency than I do, but there is still a lot of room for improvement. Taking classes, checking out library books, and volunteering to help others are good ways to learn more skills.

    #1, don’t go shopping, is hard when I’m trying to find excuses to walk to places. Most things in walking distance from my house are the houses of strangers and stores! I am getting better at admiring things without feeling I need to buying them and at thinking of such trips more as research trips (like J.) than like buying-stuff trips.

    And I’m realizing that #6, anticipate your needs, is much huger than I want it to be. Trent says, “This is particularly true when you’re aware that an expense is going to occur – when you see your tires starting to show some wear, that probably means that a tire replacement cost is coming right up.” Actually, once you decide you are the kind of person who always wants to have tires, then you are the kind of person who will have to replace them on a regular basis.

    So, everything we have is going to require periodic maintenance and/or replacement for as long as we want to continue having it. It feels quite daunting sometimes! Even if you have no debt, you’re probably still the kind of person who always wants a working refrigerator, and clothing, and now a fast internet connection, etc. Things do change – I’ve given up on electronic PDAs, and I no longer need to maintain/replace a typewriter or record player. But I sure have a lot of stuff I like having!

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