There was an article in Good Housekeeping recently that talked about how a family could save $10,000 in just one year. I find them fascinating. Not for the financial advice, which breathlessly cycles through the latest trend of the day (Freeze your credit card! Put your cash in envelopes! Give it to a financial adviser who promises to triple the return!)
It’s the details I savor and the assumptions behind them. Impoverished newspaper copy editors — but I repeat myself — don’t tend toward the splurgy end, so to read Ginny Graves’ accounts of their spendthrift ways is to revel in the details as they racked up a five-figure debt.
It’s a confessional article that doesn’t confess very much. She admits to being a freelance writer, with an income of between $1,600 to $6,000 a month. Her husband works, but there’s no details there. A little Googling shows they live in Marin County, California, a wealthy enclave — that word leaves the impression of fashionably dressed people living in compounds high in the mountains, doesn’t it? — where you’re expected to buy organic groceries, presumably at Whole Foods.
Even when she begins her program of acetic spending, she couldn’t bring herself to confess everything. Instead of her usual visits to to Nordstrom or Anthropologie (there’s you’re class markers blinking), she goes to the consignment store. Selecting a number of “trendy summer shirts,” she hesitates paying $72 for them until the clerk pulls the “this day only discount” trick and knocks 15% off the price.
For $66.70, she bought how many shirts? She doesn’t say. Two? Ten? Makes a big difference.
So what’s the difference between a six-figure income and a mid-five-figure income? Here’s what:
* “Holy Shit” Expenditures: Christmas gifts of “a fancy (read: expensive) mountain bike . . . a long-coveted video game system — plus the usual hoodies, books, iTunes gift cards, and stocking stuffers” all bought with the “one-for-you, one-for-me style of Christmas shopping.” The “daily chai lattes at Starbucks,” the money for “yard maintenance, expensive haircuts, clothes shopping” (she admits to having 40 pairs of jeans in her closets). She thinks a “bare bones” cable plan means not paying for HBO.
Her husband limits his discretionary spending to “just” $700 a month.
* A Reluctance to Own Up: “We’d always kept our money completely separate, on the theory that our erratic incomes and inherent disorganization would doom any attempt at joint banking. Besides, I’d never wanted him scrutinizing my spending habits any more than he wanted me poking around in his.”
* Incredibly High Food Bills: This family with two pre-teen boys spends more than $1,000 a month on groceries, and “we eat out just once or twice a week.” (Note the word “just,” again.). Because of her politics, she spends extra on organic food, but she also admits not using a shopping list: “it’s too regimented, too restrictive, too un-fun. I like to let whim and taste guide me.” Again, that reluctance to act like a responsible adult.
To put it in context, we spend less than $700 a month to feed my family of five. My wife eats out once a week with a friend; I don’t (although I did last night, meeting with another writer to discuss an appearance at a convention). I bag my lunch.
With expenditures like this, it’s not surprising that they could cut back enough to save ten grand in a year (actually, it’s more, because she mentions that she managed to do that, while her husband paid off “a hefty chunk of our line of credit and is almost free of credit card debt.” This must be “her” five-figure debt, but whatever else they had).
What’s amazing to me is that, to save $10K, they had to stop spending $833 a month.
And what’s even funnier is that they didn’t even go all the way to cut their spending.
* She shops thrift stores and consignment shops. We shop at Goodwill and Salvation Army (where we’ve found some killer deals, such as Geoffrey Beene shirts, Aeropostale sweaters, NFL-branded coats, all new and many with the tags still attached.
* She feels virtuous watching movies On Demand instead of going to the theaters. We don’t have cable — not since the mid-90s — and rent DVDs from the library. (We do buy DVDs. In fact, we recently splurged on the new “Doctor Who” and “Sherlock” series.)
* Her grocery shopping habits seem to be the same. My wife is a killer coupon clipper and shops using the pantry principle, buying a lot of certain items when they go on sale.
* Little to no discretionary spending. I rarely carry cash to reduce the temptation. We don’t shop for shopping’s sake. When we have plenty of clothes, we don’t buy more.
Now, I’m sure the Graves family would not say they were wealthy, but from my door-modified desktop and ten-year-old computer, an extra $833 a month would make me take up wearing a top hat and monocle and start oppressing the workers.
Nor are we poor. I support my family on my salary. We’ve had help along the way (Thanks, Mom! Thanks Penguin!), but we made sure any extras went to making long-term repairs and upgrades (a new roof, fixing the basement, adding electrical fixtures), not to paying daily bills.
But what has happen is that we in the country have prospered so much that the bar has raised significantly for what constitutes “wealthy.” I might make a good living, but that’s nothing compared to the Graves of the country. And because they have more money to play with, they had more money to waste. Just imagine what they could save if they really put their minds to it.