So there I am, sitting on an uncomfortable bench, watching the hockey game with my buddy and his wife. They dragged along their kids, since I guess leaving them at home to fend for themselves is poor parenting or something. The game is a bit of a snoozer, so my thoughts are beginning to wander elsewhere. Should I play Words With Friends? Should I ogle the cute blond a few rows over? (Note: Oh, was she ogled.) And, since I actually enjoy writing in this thing, I started thinking about a topic for a blog post.
As I’m thinking about this, I’m periodically interrupted by my friends who, you know, actually want to talk about things. They didn’t realize I had important things to think about, obviously. As we were talking, one of my friends made an offhand remark how pretty much everyone probably needs to cut back a little.
At that point, it hit me. I had an epiphany. I finally figured out why frugality blogs are, and always will be more popular than blogs that talk about earning more and investing smartly. I now know why books on frugal hacks will outsell books on how to pick stocks.
Enough teasing already! You want the answer and you want it now, dammit. You’re impatient and I like it.
It’s because just about everybody has a spending problem.
Look at me, for example. Even though I’ve cut it down a bit, I still eat far too many meals out. I’m at Subway so often that they actually start making my sub before I even go up to the counter. They know what veggies I get, and if there’s cream of potato and bacon soup that day, they know I’m getting a bowl of it. If that doesn’t tell you I eat there too much, I don’t know what will.
If you look at that portion of my budget, you’d think I have a spending problem. Yet I have car expenses of less than $1000 a year, although that’s partly because I don’t have to drive my car to work. I haven’t spent a dime on alcoholic beverages in a long time. I’ve spent years between vacations. My living room is currently filled with hand-me down furniture, which definitely isn’t scoring me style points when the ladies come over. The point is, I live a pretty frugal lifestyle.
But, as even the most monkey-like of you can point out, there’s one area I can definitely cut back on, and that’s the few hundred dollars I spend per month on restaurant food. I could pack my own lunch, or hit up my parents’ house when it’s time for supper, or even buy a bunch of frozen stuff that I just need to pop in the oven for a few minutes. It’s easy to suggest alternatives because it’s a pretty clear problem.
There are other reasons why frugality is popular too. It caters to the lowest common denominator. Anybody can cut the excess fat from their budget. It doesn’t take a whole lot of intelligence to do that. It’s also really easy, at least in execution. It’s not hard to go to the grocery store and buy knock-off brands. Besides, most people can barely do basic math. They lack the knowledge and experience needed to analyse potential investments, so they just go to the bank and buy whatever mutual fund the nice salesgirl suggests. And then they go make their own laundry detergent because when they do, they feel like they’re doing something.
You guys have probably figured out by now that I’m no frugality nut. Sure, I’ll buy all sorts of no name brands (except toilet paper) and drive an older car and do other things to save money, but I’m just going to cut the crap that isn’t important to me. I like eating restaurant food, so therefore I am going to eat it. Rather than cut it out, I focus on earning more money so I can easily justify the bad habit.
When it comes to most everyone else though, they’ve got so much fat in their budget that it resembles a Louie Anderson and Rosie O’Donnell sex tape. They do stupid crap like finance stuff at high interest rates, have all sorts of liabilities they can’t afford (like kids and pets), they have unlimited long distance packages, and so forth. I could go on all day but in the interest of brevity, I’ll stop. Most people I know could pretty easily cut $1000 per month from their budget. I know it, they know it, everyone knows it.
And yet, they’ll never do it. Even though frugality might be easier than hiring a hooker in Vegas, most people won’t get it right. I don’t know why, but here’s my best guess.
It’s often implied that personal finance is a psychology problem. You have a finite number of dollars, so you have to identify where to put those dollars to work. I think this is the wrong way to look at finance. See, finance is nothing but a math problem. And, for most people, there’s just one variable of the math problem they screw up. Rather than spending time trying to figure out what spending is valuable and what isn’t, how about people start looking at it from strictly a numbers perspective. Cut out everything you figure is a good deal because it only costs ‘x’ per month. Stop buying new crap unless you’re physically throwing the old one out.
Most people can’t even get personal finance 101 right. Which is why they’ll continue to flock to frugality blogs. I should probably just quit now.