Cut back and make do, and tell us how you do it

I’m really pleased we have no debt. Rising interest rates, high fuel prices and skyrocketing food prices are quite common world-wide now and I know many ordinary folk are feeling the pinch. I thought it might be timely to share some information about how to cut back and make do, hoping to help those of you who are starting to worry about your finances.

Rents are rising, and so is the cost of child care, clothes and shoes, electricity, water and gas. Caltex Australia announced yesterday that petrol prices will double in the next decade. Imagine that, petrol at $3 a litre! That will further increase the price of food, transport, houses … well, almost everything will be effected. It’s not fair, but it’s our reality now. I believe you have to live to your reality, not your expectations or your dreams. If I were starting out now, I would run a mile to get away from someone trying to sell me a McMansion, I would cut my cloth according to my needs and start off small.

The average mortgage price in Australia now is around $300,000. That is incredible to me. It’s too much for first home owners to pay. My sons couldn’t afford to pay a mortgage like that and they both have good jobs. I don’t know what to do about it, if there is anything, but I’d only buy a house I could afford. I would not be tricked into buying a house that looked good but didn’t allow me to have a decent and fulfilling life.

Why does everything have to be so big now? It doesn’t make sense to me. Big houses, big cars, big boats, big TVs, even big breasts! I don’t understand the hypnotic effect of BIG. Don’t good things come in small packages? Why not buy a smaller house and build a good life as your family grows. Marriage is hard enough without the stress associated with paying off a mortgage you can’t afford. If you have to put all your money into your mortgage, or rent, how do you manage to buy the other necessities of life? Are you robbing Peter and to pay Paul?

There is another way. It’s not glamorous and you won’t live in a new house, but buying a smaller home, where sons and daughters share bedrooms and families rooms, are better for children than giving them their own room, TV, phone and internet. Kids learn to socialise in their own home. Isolating them, isolates them! They need their parents and siblings around to interact with, to learn from and grow with. Starting off small, all bunked in together with mum and dad in their room and the kids sharing bedrooms, allows you to develop relationships with your spouse and children, you go through the hard times together, and that makes your family a stronger unit.

I don’t want this to sound like a lecture because that’s the last thing anyone needs. I am concerned that many people are living beyond their means, and they are doing it because they think it’s expected of them, or they want to match what their friends have. Change your expectations, start small, cut back and make do. You won’t live the most glamorous life but you’ll be happy and you'll have a better chance to build a good marriage with loving and sensible children. You’re not doing your children a favour giving them everything they want. Children learn by living a safe and secure life with loving parents. When children are given everything they want, and when there are fights over money, kids suffer.

When Hanno and I were paying off our mortgage, we paid fortnightly payments instead of monthly and we had a jar where all spare cash went. When we had enough in the jar for an extra mortgage payment, we paid it. Doing that, we paid off our mortgage in eight years. I’m sure there are other tricks to reducing your mortgage debt, hopefully our wonderful readers will give us the benefit of their own experience and tell us what they do.

Let's assume you’re paying off your home, and maybe a car as well; food will also be a large regular expense. Doing up a family budget will help you a lot. It’s not a restriction, it’s more a guide to how you spend your money. A budget will help stop money leaking out. If you have no budget, do one this weekend with your spouse. I’m sure it will help you. I resisted a budget for the longest time. When I finally did one up, I realised it wasn’t an added burden but rather a great help in understanding how much money we had, what it had to be spent on and how we got the best value for the money we had.

If you can save money on food, you’ll save quite a bit. I cut our food budget in half, then in half again. It wasn’t easy but now, when I look back, I cringe when I think of how much I wasted. Stockpiling helped me stay out of the supermarket, allowed me to buy food when it was on special and gave us a little supermarket at home where we could shop 24/7. But stockpiling isn’t the only thing that will help. Menu planning is also a good way to help you reduce the amount of food you waste, it helps organise you, especially on those evenings when everything goes wrong, you’re running late and you trip over the dog. Your menu plan will at least help you get a nutritious meal on the table for the family to eat.

Cooking from scratch is a big help in reducing food costs. The convenience you buy with some food – it might be pre-washed, already cut, or even cooked - that all costs you money. Making everything you eat from scratch, or even a good portion of your family’s food, will save you money, will give you healthier food and will cut down on all those preservatives, colourings and flavour enhancers present in convenience foods.

Grow some of your own food. If you can grow enough vegetables for your own use, you'll save a packet. It's also fun and healthy and a great activity for children. Get some chooks for eggs. Barter with neighbours. Learn how to preserve the excess harvest for later in the year. When you bite into your first home grown tomato, I bet you'll want to grow them every year.

I wrote about books a couple of days ago and I know it’s a big one for many people. We love our books. I can honestly tell you that although I have been a lifelong reader, write every day and have a literature major, I found it easy to go from buying books to reading library books. Sure, there are some books I covet and want to have on my bookshelf for easy reference, but that is one of the sacrifices I make to live the life I have. We can’t have it all. There are sacrifices we all must make.

Sewing and mending will help reduce the amount of money you spend on clothing, soft furnishings and household items. Many things that you once might have thrown out because they had a rip or a missing button can be repaired, often quite easily and simply. Don’t throw out a sheet just because it has a rip or a hole, mend it. I do this all the time now and giving a sheet another one or two years service because I took the time to repair it will gives me a feeling of pride in a job well done, and I know I’m using resources to their full extent. Doing these small things really does make a difference.

If you're thinking you might get a second job to cope with the financial pressure you're under, do your sums first. If you have young children and you have to pay for child care, you may not make enough money to make your job worthwhile. If you're working at home, make it your job to be the best custodian of your household expenses that you can be. Work at saving money, specialise in making do and cutting back. All those simple money-saving things you can do if you're at home might be the difference between make or break for you.

I’m sure there are readers here who are suffering with the rising prices. I want to encourage you to stop buying the little things that don’t cost much – bottles of drink, cups of coffee, fat quarters, bits and pieces you don’t need but want; whatever it is, stop. Use all that money to pay off your debt. There are hard times ahead, prepare for them now and you won’t panic later. I hope everyone will share their thoughts on how to cut back. I know there are many wonderful readers with some excellent thoughts on this. I want to build a post of valuable money saving ideas that have really worked; the tried and true methods that have helped you cut your debt. Later today I’ll start building another post with the great ideas I know we’ll get in the comments section. Please help if you can, join in and help your blog neighbours in these hard times.

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