Beating Broke

How Much “Stuff” Do You Own?

February 17, 2014 By Shane 12 Comments

Every few years or so the discussion in my house comes back around to how we’ve seemingly outgrown our house. It’s about 12oo square feet, and there are currently 2 adults and 2 children living in it. It can get cramped. Sometimes more than others. But, I try to remind myself that the people we bought the house from somehow managed to raise 4 children in the home. How? I have no idea.

We have a bunch of “stuff”

I think that one of the major differences between the couple that lived here before us raised their children in a different age. It was an age of far less consumerist tendencies. And, even with our increased awareness of consumerism, we still seem to accumulate stuff regularly. I’d be lying if I didn’t say that I contribute almost as much to the problem as anyone else. I’m frugal to a fault, but there are plenty of things that I accumulate that fit within those frugal means. Books would be the primary culprit. I’ve been better lately, buying books for my kindle more often, but I still have quite a bit of books that are hanging out on shelves.

Aside from the books, we’ve also got an entire shelf full of DVD movies. We probably only watch about 4-5 of them with any sort of regularity. And they’re all kids movies. I can’t tell you the last time any of the adults here watched any of the adult DVDs. It’s hard enough for us to find our time to watch The Walking Dead.

There’s so much other “stuff” that we just don’t need. Every so often, we go through and clean a bunch of stuff out, and minimize a whole bunch of “stuff” out of our lives. And, slowly, it all creeps right back in. Either through gifts, or through replacement with other new things, it eventually grows to the same size. I suppose it’s because it’s not really a “necessity” that we keep the minimalism up.

It’s nice to have a certain level of creature comforts around. Things that we simply don’t need, but that we use once in a while.

[Tweet “Have nothing in your house that you do not know to be useful, or believe to be beautiful. – William Morris”]

How wonderful would that be? Nothing that isn’t specifically useful, or that you don’t think is beautiful. Of course, that means you’d have to find out how you define useful. Beautiful is easy to define, even though it’s definition is a little different from person to person. Useful, though? That’s a different story. At it’s simplest, you can probably define useful as something that you use daily. Or maybe it’s something that you use weekly. Or monthly? Well, maybe it’s not so easy…

What You Want Balanced By What You Need

If you’re reading this article, you’ve likely read other articles. And if you’ve read other articles, you’ve likely also read a few about people who live in incredibly small spaces. Those are people who’ve really, really managed to discover just how much they really need. The rest of us likely are living with so much “stuff” we don’t really need. And, if we’re living with so much “stuff” that we don’t need, maybe it’s just the natural path of things.

I don’t know about you, but I don’t really want to believe that it’s just “natural”. I think we accumulate “stuff”, even if it’s subconsciously, just because we can. Because we don’t have any good reason to live minimally. That would require work. That would require some commitment.

And frankly, work and commitment are something that most of us aren’t willing to give to our “stuff”. We’ve got better places to put our time and efforts. But, we can take small steps.

What steps do you take to make your “stuff” more minimal?

5 Quick Ways to Start Prepping. You’re Already Doing at Least Two of These.

February 14, 2014 By Shane 11 Comments

In my recent post about the state of the American economy, I told you that you didn’t need to immediately go out and become a prepper. And you don’t. But, much like anything else, it helps to be prepared. You don’t have to have a bunker under your backyard, a whole armory in the bedroom closet, or enough food to feed your whole neighborhood for years. You can, however, start making sure that you and your family have a good start in preparing for any disaster. Here’s 5 quick ways to start prepping. And you’re already doing at least two of these!

Stockpiling

You don’t have to have enough stockpiled to keep your family fed for months or years. But, if there’s anything that this winter has taught much of the U.S., it’s that it’s very possible that you could find yourself stuck in one place for several days.

What should you stockpile? Well, food is a good start. Canned and dry goods mostly. Beans, rice, canned vegetables (straight from the garden if you DIY), flours, grains, vacuum packed foods, and canned meats all are good staples that can go straight into your pantry and provide backup food sources should you be unable to reach a grocery store. (also, if grocery stores cease to exist… but let’s not go all extreme just yet.)

Stockpile other goods too. Toilet paper, pet food, matches, fire starters, medical supplies, and even ammunition if you have that armory in your closet. Any essential that you use regularly that won’t spoil is fair game for stockpiling in case of emergency.

Reducing Debt

If the economy crashes, do you know what the worst thing to still have is going to be? Well, if you haven’t guessed it, that thing is debt. If you think your hands are tied by debt now, just wait until the economy is in the dumps, you lose your job, and inflation kills your buying power. Debt is your enemy, no matter the state of the economy. Start with a detailed spending log where you list what you spend every day. Knowing what you spend, and when you usually spend it, create a simple budget. Stick to the budget, and pay down debt by whatever means necessary. Get rid of it. Even if the economy booms, you’ll still be better off.

Become More Sustainable

Sustainability isn’t just for hippies. Being eco-friendly maybe attributed to the earth loving, free love, woodstock-ing people of previous generations, but today, it’s an excellent way to be healthier, and save money on costs. There are lots of things you can do to become more sustainable.

The easiest way to start making a difference in your bottom line is to replace high energy consuming items with low energy consuming items. LED or Incandescent light bulbs are a relatively cheap start, and last for years. High efficiency appliances like on-demand hot water heaters are more expensive, but can save a lot on energy over the long run. Try air drying your clothes too. It takes a little longer, but make it a habit, and your energy savings will grow a lot.

Growing your own vegetables, installing rain barrels, and composting are also great ways to decrease your footprint, while saving yourself money. You can replace that produce at the grocery store with home-grown veggies, use the water in your rain-barrel instead of the electrically pumped water from a well, or the municipal water, and you can save on what you put into the dump while providing nutrient rich compost for your garden.

Learn New DIY Skills

If the economy completely fails, there’s a good chance that your access to many of the services and products that you have access to now will be severely limited, or severely cost prohibitive. Not only will learning new DIY skills (like growing vegetables, canning food, repairing items, building items (like a deck), and the list goes on) save you money by allowing you to not pay for someone else to do it, but you’ll also gain a barter-able service that you can trade for services you can’t do.

There are plenty of ways to learn new skills too. You can just try it and see what happens, although, in my experience, doing so increases the chances that the project you’re working on will take longer or fail entirely. If you look, you can probably find a local class that can teach you some of the skills. Videos on YouTube and instructions on the internet (easily found through a search) are also great ways to learn something new.

Make Your Plans

We all know that we should have a plan so that everyone knows what to do should they wake up in the middle of the night to a house that’s on fire. We give our children a plan should they get separated from us in a crowded place. We create budgets to plan how we will spend our money, and pay down our debt. Having a plan for an economic collapse and the conditions that could arise should it crash doesn’t cost us anything. A little time, and some thought. That’s it. Do you have family that you’d “bug out” to? Are there people in town that you’d want to help? Are there people in town that would help you? How will you get wherever you’re going? Even if that’s just home?

Having a plan, and executing it if you have to is very likely to be the difference between uninterrupted life, and something far more unpleasant.

How many of these things are you already doing? Which are you going to try out?

Original image credit:Robert Benner Sr., on Flickr.

How to Protect Your Investments in an Unstable National Economy

February 11, 2014 By Thomas Bawdy 5 Comments

The U.S. economic downturn of 2008 caused investment losses for many, leaving everyone unsure about economic instability. You may wonder how you can keep your investments safe in an unstable national economy. Educating yourself, seeking unique opportunities, avoiding staying too liquid, employing defensive stocks, keeping selling separate from buying, and considering commodities are several ways to keep your investments safe.

Paper with Financials

Image via Flickr by Andreas Poike

Educate Yourself

Proper education is critical for both the investor’s comfort level and investment success. Just as the housing bubble contributed to the Great Recession of 2008, future bubbles could threaten your investments. Recognizing the characteristics of a bubble could help you get out of risky investments. While there is no one formula for determining whether an industry is in a bubble, businesses with small revenues with large market caps should cause concern. Understand that industry bubbles have large-scale impacts on the entire economy.

Understanding other economic indicators is helpful for proper investment selection. Fisher Investments supports investor education. Their YouTube videos about investing outlooks and education offer insight on ways to make the best financial decisions.

Seek Unique Investing Opportunities

Everyone knows that diversifying your investments is a great way to protect them from volatility. However, are you considering unique opportunities? Peer-to-peer lending is unique and can provide an additional investment strategy to keep you protected during an unstable economy. These loans are higher risk because they involve unsecured loans to individuals, but the lending platforms generally bundle loans to decrease the risk of failure. Depending on the loan you choose and your risk level, these can have attractive returns.

Invest for Your Timeline

Your response to economic instability should relate directly to where you are in your investment timeline. If you are close to retirement, you are investing conservatively to protect your assets. However, if you are early in your investing, economic instability should have less bearing on your longterm goals as the ups and downs will level out over time. Continue to exercise caution in an unstable economy but be comfortable taking risks as long as you are comfortable with losing that investment. In a long-term investing strategy, you have time to recuperate any losses from risky investments.

Avoid Staying Too Liquid

In an unstable economy, keeping cash on hand might be tempting. While it is good to keep some cash, too much cash prevents you from enjoying market returns. In an unstable economy, increase cash but do so modestly. This allows for a balance between having a safety net and benefitting from market growth.

Stacks of Money

Image via Flickr by vxla

Employ Defensive Stocks

Defensive stocks are from sectors that stay consistent despite the economy. Examples of sectors with defensive stocks include healthcare, food companies, utilities, and consumer staples. If another economic downturn occurs, these stocks continue to offer growth. The downside is that these lower risk stocks offer less lucrative returns. Use a diversity model consistent with your investing goals when adding defensive stocks.

Keep Selling Separate from Buying

While common practice tells you to always buy more stocks when you sell, this is not always the best move in an unstable economy. By sticking to the rule that you should only sell when you have something else you want to buy, you may miss opportunities to sell your stocks at their best price. Instead, when your stock hits its target price, sell. You will have other opportunities to buy stocks that align best with your investing goals.

Consider Commodities

Commodities are a possible option for keeping your investments protected. If an unstable economy begins to drive up inflation, people will still need to purchase commodities. A diverse portfolio with commodities allows you to capitalize on this. Because commodities present greater risk, buy according to your investment goals.

There is no foolproof plan for keeping your investments safe during an unstable economy. Incorporate these tips into your investments so that they align with your level of risk and comfort. These steps can lead you towards a better-protected portfolio. What are some other ways to protect your investments in a shaky economy?