During an economic recession we might feel unsure of what is best to spend our money on. It seems that what has applied in the past has somehow changed. At a time when we need to know with greatest clarity how to manage our money, we feel uncertain. May I suggest twelve ways you can move forward with financial confidence in uncertain times.
1. Be happy with less
As a society our insatiable hunger for products has left us stranded. No amount of acquiring stuff seems to be enough.
Buying more does not satisfy this hunger. For many of us, we can get by happily on less. Choosing to be happy with less can be a great blessing.
2. Avoid debt like a disease
Borrowing has enslaved many in our society. Often this is in the form of spending more with a credit card than can be paid off before the interest is due. If you cannot afford something, postpone the purchase or do without.
Pride, weakness and lack of self discipline are some of the reasons for spending more on a credit card than can be paid off within the month.
If you are in dept, stop spending. Never let yourself get so far in debt that you have to pay interest on your credit card. Avoid debt like a disease.
3. Live frugally
If you have little money then even small financial mistakes can make it hard for your family. Gather your family and choose together to be frugal. Agree to take short showers. Use public transport instead of your car. Find ways to live on less. Even if you are on a high income you can choose to live frugally. This will give you more money to invest in sustainable living.
4. Defer Spending
Put off buying something big by calendering it for next month’s budget. Who knows, when next month rolls around you may change your mind. At least you’ll be able to make a choice with all your other priorities on the same wish list.
Deferring spending allows time to incubate your financial priorities.
5. Defer payment
If you do buy a larger item now, and you have the money in a term deposit, if you are disciplined you can ask if you can pay when your term deposit matures. This can be a trap for those with less financial self-discipline or if you do not have term investments.
Deferring payment means you will not run out of money in your current month’s budget.
Also, you’ll not have to pay fees and lose interest by breaking a term deposit. This saves you money if you have a term deposit maturing and can defer payment until the date when your money becomes available. No term deposit, don’t do it.
6. Invest in frugality
Investing requires making a deposit. Your paramount deposit is of your time. If you have money, you can invest some of that too. A little goes a long way. No deposit toward self reliance leaves you destitute and dependent upon others, subject a roller-coaster economy. No deposit toward self-reliance means you’ll have no insurance against future economic hardship.
Spending on hiring help to weed your vegetable garden, prune fruit trees or organize your food storage is creating a job, however small or temporary, even if it’s just an hour a week. Spending on products needed to establish your vegetable garden or other self-reliant item can help bolster the economy.
In all your investing, invest in frugality and sustainability. Spend time and whatever money is yours on setting your family up to live within your income.
7. Invest in gardening labour
Vegetable gardens need time on nearly a daily basis. If you don’t have time but have a little available money, plan to hire someone to tend your garden for just a few hours per week.
Creating jobs is first on Mark Riddix’s list of ways to stimulate the economy. 1.
If you are working full-on and have little time, then hire labour help. When families, that can afford to, hire people to tend their gardens they also stimulate the economy. The garden does not care who tends it, you or your labourer. If you have 10 minutes a day and want good health, then work in your garden. Invest your time or someone else’s time.
Invest at least 15 minutes a day in gardening labour.
8. Invest in gardens
Execute your plan for home-based food production by investing cash in your garden. Before spending on entertainment, buy the materials you need to construct and maintain a productive garden.
Setting up a garden costs money. Start small. You will recover some of that money by growing your own vegetables.
George Ball says that “items like fences
and tools last for years, and their costs should properly be amortized over the life of the garden. In fact, he believes his seed-payback ratios understate the true benefits for growing your own ‘because of the vastly superior produce you’ll get’ in a home garden, compared to what you get from a supermarket.” 4
“The second income avenue of investment gardening” according to Donna Cosmato, “is planning in advance to grow a surplus of vegetables.”5.
Donna believes the sale and trade of seeds to be the first form of income.
Investing in your garden is an insurance policy. Do you work out your ROI (return on investment)on your insurance premiums? Probably not. So just pay your premium by investing in your vegetable garden.
Box gardens, tunnel house plastic, seeds, tools and compost all can be purchased. Plan to invest some cash in your garden.
9. Invest in frugal clothing
One of the great ways to invest in frugal clothing is to donate all your unused clothing to the Op Shop or thrift store. All proceeds from our local Op Shop go to the Food Bank to provide meals for the needy.
While you are there, buy used clothing that suits you and fits well. Both your donation and your purchases stimulate the economy.
The greatest leverage from investing in used clothing is enjoyed by those in financial debt or hardship. By buying low-cost clothing and shoes for the family, parents can free themselves from debt. Families will then have cash free to invest in other items to move their family into sustainable living.
10. Invest in your home hospital
Your home hospital is in your home.
Families can buy first aid items from the supermarket rather than spending on less essential things. Each week or two, add new items to your family hospital.
Rather than have it all in one place, we share out items among family members in their small, soap-container emergency first aid kits. Keep one in each vehicle your own.
In an emergency, your family members will have access to the first aid they need. Spending on emergency preparedness and first aid will help stimulate the economy and increase your medical independence.
Rather than buying a complete first aid kit, plan on buying the medical items piecemeal and slowly building up your family hospital over time in a planned way.
11. Invest in food storage
If you can afford it, rotate food that has been stored for a long while by giving it away to your nearest food bank. If it’s too old for needy, hungry people to eat, then you will not eat it either. Feed it to the hens.
Then replace your food storage.
In the future you’ll be eating on today’s food prices which means your food will be an investment.
If you store it well and use it within a year then you’ll be managing a stable, safe investment. How can you lose your principal investment? Rats. Fire or flood. Earthquake. You can insure your food storage against all these things. Your new food storage is an investment that appreciates in value, that you can swap or trade or eat, that is covered by your household insurance. That is hard to beat.
Food storage remains a mighty safe investment, even during a time of extreme economic hardship. I recommend storing food you know how to use rather than buying prepacked solutions of dried or canned food. Custom-buy your food storage to your own family’s diet. Grow it. Store it. Buy what you need to get it stored away for future use. This is your best insurance policy and investment polled into one. Spending on food storage will also stimulate the economy.
12. Invest in food storage labour
If you cannot find time to add up your food storage items, then hire a trusted person to do your food stock-take. Hire and pay older children to update your food storage status. They can tally up, wipe down, organize and relabel food items.
Then they can calculate exactly which food you need and how much food you need using the food storage calculator. Youth, young adults and students can be ideal for this mundane task. There’s a food calculator for this at www.providentliving.org.nz/food-storage-calculator/
ROI – Return on Investment
Regardless of your income or savings, a time of economic hardship is still a good time to refocus upon investing, your time and whatever money you still have, in self reliance projects like vegetable gardens, emergency preparedness and food storage.
For those fortunate enough to have any money at all, rather than seeking a return on your investment, you could well be concerned that your investment will be returned. At all. The above categories increase the likelihood of your investment being returned and having a bright tomorrow.
My Unique Terms & Definitions
Exchanging money in hope of increased returns. This ROI (return on investment) is not necessarily a cash return during this recession.
Not having to spend more money later, holding value or holding value of money, gaining security or safety or insurance, assuring future welfare, and provident living for your family.
Exchanging money for something that has no return after today.
1. Mark Riddix, Best Ways To Stimulate The United States Economy And Create Jobs; http://www.moneycrashers.com/best-ways-to-stimulate-the-united-states-economy-and-create-jobs/
2. Kai Ho Chong, Is monetary policy alone enough to stimulate economic recovery? http://project-firefly.com/node/10340
3. Betty Jin, 10 Ways To Stimulate The Economy Right Now; page 4, http://www.businessinsider.com/ways-to-stimulate-the-economy-now-2010-8
4. George Ball, How Much Green Can Growing a Vegetable Garden Save You? http://online.wsj.com/article/SB123983924976823051.html
5. Donna Cosmato, Save Money by Investment Gardening; http://voices.yahoo.com/save-money-investment-gardening-2811241.html
See all the photos and links to the photographers on the Photographer Credits Board.