Thrifty living can be born from a frugal upbringing or be the result of a life situation that makes it a necessity
In 1996, Gary Foreman took a leap of faith and started his own business. As a financial planner and purchasing manager, Gary knew how to get value for every dollar he, or a company, spends.
The Dollar Stretcher—a personal finance website—is a way for Gary to share his expertise, make money and carve out his own independent niche.
“I’ve always tried to be very practical,” says Gary, who lives in Bradenton. “When it comes to personal finance, I know many people who either don’t believe they can understand the topic or believe that they can’t do it.”
Given this perceived idea about money management—and in a society driven by the desire for the latest and greatest—Gary recognizes the need for personal finance education.
“It is actually critical for people today to understand their finances,” Gary says, noting he strives to offer information in a way everyone can understand.
Personal finance stretches beyond retirement plans and stock options to simple, everyday lifestyle changes and money-saving behaviors that result in substantial savings.
For some, it is breaking the daily latte or shopping habit, or cutting monthly grocery costs in half. For others, it is viewing debt as a financial emergency and strategically planning to pay it off.
“I get emails from too many people who have put off saving for too long and want to turn back the clock,” says Gary. “No financial planner can do that.”
People are Seeking Help
Since the 2008 recession, many people have turned to online resources, such as Gary’s blog, for tips and tricks to save money. Personal finance websites, such as The Penny Hoarder, are thriving.
“We focus on keeping more money in our readers’ pockets, not so much stock markets,” says Justin Cupler, assistant editor at The Penny Hoarder, headquartered in St. Petersburg.
Since it started in 2010, The Penny Hoarder has attracted more than 6 million active subscribers with posts ranging from money management to food freebies.
“We cater to the masses,” says Justin. “Everyone is looking for ways to make money. We try to catch on to trends where people can find real-life ways to earn money and save money.”
The first principle to personal finance is you get out of it what you put into it, says Justin.
For every person, regardless of age, the first step to managing money is paying off debt. Justin says there are two approaches to effectively tackling what you owe.
“The debt snowball is paying off the lowest-balance credit cards first, then once that card is paid off, rolling that payment into the card with the next-lowest balance,” Justin says. “Debt avalanche is the same concept of rolling payments, but you focus on paying the highest interest cards first.”
Easy Ways to Save
Paying off debt often means cutting back on spending. Blogger Karrie Truman is an expert on household savings. Her blog, Happy Money Saver, gives readers easy ways to save at home, ranging from making homemade laundry detergent to building a dream house on a budget.
“In 2009, I first started blogging because I was finding so many good deals,” says Karrie. “I love to experiment, so I started doing tests of whether making your own laundry detergent really saves money. I made my own (version of) Burt’s Bees for 12 cents a tube. I’ve been frugal a very long time. I think I just love saving money.”
Karrie’s blog has grown so much that she pays 10 people to contribute to and help manage her site.
“I have some people do recipe creation,” she says. “Some people help me with photography. I have people that help with writing thrifty articles, and I have somebody that manages all the different social media outlets.”
Karrie’s most popular blog section is about freezer meals. She says preparing meals ahead of time is a great money saver.
“You may make multiple trips to the store every week, which leads to impulse shopping,” says Karrie. “When you do freezer meals and make 30 meals all in one day with one batch of groceries, you save all that time you would have been cooking when you get home.”
By living a frugal life, Karrie was able to make her dream of owning a piece of land and farm animals come true.
In February 2016, her dream home on 5 acres was completed, and she started her own homestead.
She blogged about the process.
“It takes a lot of research to save a lot of money when building a house,” says Karrie. “I was constantly researching everything—from the best quality and least expensive options. There’s so much research involved, but it pays off. The amount of work you put in it will pay off.”
Teaching the Art of Budgeting
Whether it is saving on groceries or planning for retirement, setting a budget is an important part of personal finance.
Carolyn Wyatt knows budgeting can set a person’s life on a new track.
The Hardee County extension agent teaches money management classes at the Hardee Help Center in Wauchula. Classes attract five to 10 participants, who learn the basics of budgeting for weekly and monthly expenses.
“The way I structure it is I have a virtual family I have made up, and we as a group develop a budget for this fictitious family,” says Carolyn. “I have set criteria and have that listed on a sheet of poster board. Then we talk about how we are going to go about creating a budget for this family.”
Carolyn sets a monthly income of $1,200 for the single-parent family. Participants get cards with specific budget items on them, such as food, rent and gas. As a group, they determine how much should be allocated to each budget item.
“I say during the class and at the end of class, ‘You’re giving every dollar a job. It must do that job and no other,’” says Carolyn. “If you have $15 designated for your child care expenses, that is the job the $15 has to do and nothing else.”
Participants go home with their own set of cards, which have an area where they can track what they spend on each card’s budget item every month, along with a money management wall calendar to track expenses, bills and money spent every day.
Since starting these classes more than 15 years ago, Carolyn has seen a change in how she lives her life.
“It made a big difference in my life because you can’t teach something as long as I’ve taught it and not have it become embedded in you,” says Carolyn. “I am very, very cautious about where my money goes and making sure I keep to my budget.”
Recession Prompts Lifestyle Shift
Educating the public about personal finance means practicing what you preach. Sometimes that lesson comes about unexpectedly.
Teresa Mears always lived a frugal lifestyle, but the 2008 recession sent her career and life in a new direction.
After being laid off from the Miami Herald, Teresa thought she could turn to the property she owned and find comfort in her 401(k). But three months after leaving the Herald, the recession hit.
“This came at a time where my personal finance situation wasn’t that great,” says Teresa. “My partner died the year before—and she was sick before she died—so I struggled financially before leaving the Herald. Then my 401(k) lost half its value. My property lost half its value.”
On top of it all, the 2008 recession had a ripple effect and prompted the newspaper industry to drastically downsize.
Teresa knew she could not count on getting a job at another newspaper.
In early 2009, she made the move to online publishing and started Florida on the Cheap, which is part of a network of Living on the Cheap websites throughout the country.
Teresa had not worked in online publishing. It took her eight days to build her WordPress website. Then she started learning everything she could about online publishing. Teresa is now executive editor of Living on the Cheap with its more than 30 local city sites, and publisher of Florida on the Cheap.
“I had been raised to be frugal,” says Teresa. “This was kind of a good time to go back to my roots and look at what really matters.”
Florida on the Cheap gives tips on free attractions, travel deals and more, all broken into the state’s regions.
“We actually cover a pretty wide variety of topics because we consider our audience to be all ages,” says Teresa.
Teresa also freelances for US News & World Report, writing about personal finance, real estate and retirement.
In a recent article, “A Beginner’s Guide to Investing,” Teresa gives readers a step-by-step guide to start investing.
She encourages everyone to invest.
“It’s never a mistake to save money, but you can earn more investing than you can earn from a savings account,” says Teresa. “The easiest way to start investing is taking advantage of your company’s 401(k). If your company matches, you’re not going to get that return on investment anywhere else.”
In the past seven years, Teresa’s life has drastically changed.
“I think we all learned a lot from the recession—that experiences and relationships make us happier than things do,” she says. “There is no shame in using your money wisely. You want to be the one controlling your money, not letting money control you.”
For Gary, having control of his finances allowed him to recognize the lifestyle he wanted to lead.
“A lot of spending is just wasteful,” says Gary. “It doesn’t buy happiness. We remember money spent on experiences as opposed to money spent for things. Quite often those experiences are just as good if they are not that expensive.”