Justin Tadlock

Living the frugal life

I spent over $800 at Wal-Mart last month.

Wow. Just wow.

Call me crazy. Call me stupid. Call me whatever you want. I’m sure it won’t compare to the things I’ve called myself after looking over the financial reports I made last week.

The realization

I took a vacation last week. This wasn’t one of those vacations where you hit the beach and drink mohitos from sun up to sun down. I took a vacation to reorganize my life. Part of this reorganization was to make a plan for a better financial future.

That sounds kind of lame, but it’s something I had to do.

While I won’t go into specific dollar amounts, I will say that I make more than twice the amount of money than the average American in a year. Not so bad for a single, 27-year-old guy living in rural Alabama. So, why is it that I feel just as broke as the average American?

Yes, $800+ at Wal-Mart definitely contributes.

Part of me had come to the conclusion that no matter how much money you make, you’re broke. Living off minimum wage and going to college? Broke. Making six figures and driving sports cars? Broke.

Does life really have to be this way? I plan to challenge that view.

I don’t live paycheck to paycheck or have a ton of debt like many people do, but I never feel like I’m getting ahead. I’ve just been going about business as usual. After realizing how bad my spending habits have been in the last couple of years, I set out on a plan for my financial future.

Making a plan

I suppose it is fortunate that I grew up in a middle-class, smalltown Alabama family with too much debt. For a couple of years, my dad and I lived in a three-room shack (kitchen/living combo, bathroom, and bedroom). I’m no stranger to living within my means.

The only problem is that I didn’t know what to do with money when I started getting more than I needed to buy the necessities. No one taught me about that.

I’m also fortunate enough to only have one debt: my student loan. This gives me a ton of freedom to plan for the future.

I’ve read several thousand frugal tips and tricks in the past week. Many of them don’t apply to me. A large majority of the tips aren’t great for single guys either. But, I’ve learned quite a bit in the process.

The most important thing is the budget. I already knew that, but it was nice to be reminded.

Once I sat down and actually wrote out a budget, I saw that I had a ton of flexibility for getting ahead. I can pay off my student loan in three years (two years if I’m extremely frugal). This was something I was looking at paying off in another 10 years. Two or three? I would’ve told you that was impossible a few months ago.

Make a monthly budget. It’ll save headaches.

Tools of the trade

I’ve gotten tons of great ideas and feedback from friends and family. The major tools I’m starting out with are:

  • A monthly budget.
  • A price book.
  • The envelope system.

A price book is a book you put together yourself (I’m using a three-ringed binder and notebook paper). The basic idea is to keep a list of all the things you purchase on a regular basis. You can then compare the product prices from different stores, even making a note of when things go on sale. It takes a few months to get it going, so it’ll be a while before I can fully test its effectiveness.

The envelope system is an oldie, but for someone who doesn’t think before swiping the debit card (raises hand), it is useful. I’m keeping envelopes with cash for variable costs that I don’t pay from my bank account. For example, groceries, gas, and “fun” money are three of my envelopes. By only having a specific amount of money available for certain things, I can’t go over my budget.

You can find out tons of information about all of these systems with a quick search online.

By the way, I’ve saved about $150 in my first week using the envelope system, so I’m already reaping its awards.

Do you have any frugal tips?

I turn to you, dear reader.

  • What things do you do to live more frugally?
  • Any favorite frugal or money-saving Web sites?
  • Recommended books? (I’ll have to budget for these.)

Please don’t tell me to make my own soap or go dumpster-diving for food. I’m not that desperate. I’m looking to find the best ways to maximize the value of my money and time (and personal hygiene, of course).

If you’re like me, you might not have much to share. So, let me share with you. Start that budget today. I’ll guarantee that you’ll find ways to save money.