Off topic

I’m not normally one to talk about personal topics on my blog, but a few people e-mailed me about my last post, asking how the Thoughts on Translation household lives so cheaply. Given that financial management is an important part of making it as a freelancer, I thought that this question merited an OT post.

I feel well-qualified to write this post; I’ve been called cheap, a tightwad, quasi-Amish…one of my sisters-in-law even referred to me once as having “thrift issues.” But I can tell you this much: frugality works. Here at Thoughts on Translation, we carry no debt except our mortgage and we expect to have that paid off within 3 years, at which point we’ll start saving toward some level of financial independence (a term we find more uplifting than “early retirement”). The mantra of my favorite personal finance blog, Get Rich Slowly, is “Do what works for you.” Some people will cringe at these frugality tips but will have some of their own that I’m reluctant to embrace (feel free to post those in the Comments!). Here are some of my core frugality tips, separated by category:

• Credit card debt: Out of the question. If you’re consistently accruing credit card debt, you’re living beyond your means, period.
• Forced savings: We direct-deduct a percentage of our income into a savings account every month. If you never see it, you don’t miss it.
• Transportation: We have never owned more than one car, and we have never owned a brand new car. Until 2008, we drove a 1991 Honda station wagon that we bought for $2,000 from an ad in our local supermarket. Last year we upgraded to a 10 year old Subaru station wagon. We drive as little as possible and use bikes and walking for most of our weekday transportation needs including my husband’s work commute, saving the car for major shopping trips and recreational use on the weekends.
• Utilities: We don’t own a clothes dryer (hence the “quasi-Amish” reference); most of the time we can dry the laundry outside, otherwise we use drying racks in our basement. We don’t have air conditioning. We keep our heat on 65 during the day and 60 at night. All of our electronics (microwave, DVD player, etc.) are on power strips with on/off switches so that they don’t use any electricity when they’re not operating. Using these techniques (and switching to compact fluorescent light bulbs), we’ve cut our electricity usage to under 300 kilowatt hours per month, less than a third of what the average U.S. household uses.
• Entertainment: Most of our entertainment consists of outdoor activities, on which we spend a fair bit of money (our total skiing budget is about $1,000 per year). We don’t have broadcast TV so cable isn’t an issue. We do have a DVD player but we only watch DVDs from the library or borrow from friends.
• Cell phone: I  have a prepaid cell phone (it’s OK to laugh…) on which I spend about $150 a year. Maybe I’m just not much of a phone person, but I’ve never found that I need more than about 100 minutes per month because I mostly use the cell phone as my personal pay phone. Probably 90% of my cell phone usage is to check my work messages when I’m not home.
• Food: Tasty, healthy food is a big priority for us. We spend $600-$800 a month on food for 3 people. For health and environmental reasons, we buy mostly organic food. This bill includes nearly all of our meals, including my husband’s lunch for work and my daughter’s lunch for school; we eat out once or twice a month but rarely more than that. We pay about $450 a year for a share in our neighborhood-supported farming program and also grow a lot of our own food during the summer.
• Furniture and home furnishings: We’ve never purchased a brand-new piece of furniture. Every piece of furniture in our house was either purchased second hand, trash picked (you can cringe, it’s OK!) or given to us. Ditto for our home furnishings; just after we moved into our current house, we scored a full set of dishes and glasses from a neighbor’s free pile (but I promise that we washed them really well before we used them). However, used sheets and towels are one place where I draw the line; some people are willing to delve into this black belt tightwad territory, but I’m in favor of buying these things new.
• Bulk buying: When anything with a long shelf life is on sale, we stock up, and I mean really stock up. If I see a good discount on something like soap, dental floss, laundry detergent, olive oil, maple syrup, etc., I normally buy enough to last 3-6 months.

There are still some areas in which we can do better. I feel like we spend too much on long distance phone calls (using the default service from our phone line provider), but I haven’t had time to research better options or to test Skype with a wireless headset so that I’m not tied to the computer when I’m using it. I’ve thought about joining a food purchasing co-op for items like flour (of which we use a lot because we bake our own bread), sugar, coffee, cooking oil, etc., but I keep missing the order deadline for the group that is active in our neighborhood. We could probably save money by hauling our own trash and recycling to the local transfer station, but I’m willing to pay for the convenience of having it picked up at our home. I also keep meaning to look into high-yield savings accounts and CDs through reputable online banks. However, overall I feel that our frugal choices have really paid off and have allowed us to a) work toward things we really value, such as great vacations and saving for our daughter’s education and b) avoid being tied to unpleasant work situations simply because we need the money. I’d love to read other people’s frugal tips and insights too!