I learned how to stretch a dollar from my mom. Looking back, she never actively taught me how to approach money, rather I learned by watching her. For example, at the grocery store, we stuck to the list and filled the freezer when items were on sale. When shopping for clothes, we went to discount stores, shopped on the sale rack and frequented the outlets (back when true outlets still existed). My mom showed me that finding a bargain took patience and saving money was worth the effort.

Delayed Gratification

Similarly, my sister and I had to earn the things we wanted. If we had our eye on a toy or a new outfit, my parents encouraged us to save our allowance or wait for our birthday. It was frustrating to see my friends get everything they wanted for no obvious reason. However, earning things taught me a critical skill from a young age: delayed gratification. I couldn’t have everything, but I could have the things I wanted the most if I made a plan and and put my mind to it.

A penny Saved

Consequently, I always opted to save my money. I have vivid memories of opening my small, white cash box with a miniature key and carefully counting piles of one and five dollar bills. I remember feeling excited and proud when I saved over $100. My dad nicknamed me Money Bags because of the cash I squirreled away in my bedroom. As I got older, I couldn’t wait to get my first job and did at the age of 14. I was a soda jerk at a family restaurant for eight summers. I enjoyed the satisfaction of depositing my earnings into the bank and watching the balance grow.

Adulting on a Shoestring

As soon as I graduated from college, I moved to NYC to pursue my dream of being an actress. The rent in my first Manhattan apartment was $2,300 per month! For obvious reasons, my frugal tendencies kicked into overdrive. I started training myself to only buy necessities. To all of the 80’s babies out there, think bare bones rations on the Oregon Trail. Somehow, I must have known I needed to develop this skill set for long-term survival.

I’ve read about people who had to take drastic measures to pull their finances out of the gutter. They became super-savers out of desperation, to escape crippling debt. Gratefully, that wasn’t part of my story.

On the contrary, I’ve always approached life as if a financial apocalypse was waiting around every corner. Anxiety paired with a modest lifestyle have kept me afloat during multiple layoffs and long periods of unemployment. Ironically, being unemployed during the coronavirus pandemic is basically my worst fear realized. This is the financial apocalypse I’ve been preparing for since Y2K! Funny, not funny. 🤔😂😭

Simple Finances

I strive to keep my finances as simplistic as possible. For example, I had to buy a new HVAC system last fall. It was a painful purchase, but I got an excellent deal (of course). Thanks to Costco, I received 18 months interest free financing. Obviously, I was going to pay it off within 18 months, but I made it my goal to pay it off as early as possible. So, I signed up for autopay and made extra payments when I had money left over at the end of the month. I put my tax refund and covid stimulus check toward extra payments as well. In the end, I paid off a $7,000 HVAC system in seven months! By eliminating that bill, I got my budget back to basics and an extra payment off my plate. I used the same technique to pay off my car loan in two years.

If I can’t pay cash, I pass

My rule of thumb for any purchase: if I can’t pay for it in cash, I don’t buy it. For this reason, I’ve never have an issue paying my credit card bill at the end of the month. Now, this doesn’t mean that I don’t treat myself. It just means that I plan for big expenses. By following this rule, I’ve never overdrawn my bank account or paid late fees on anything… ever.

Friends, you can do a lot on a tight budget. But, you must plan for and hold off on major purchases until you can pay for them in cash. At first, delayed gratification may feel uncomfortable or like a punishment. But, it’s a helpful technique that will keep you out of debt and in control of your money, not the other way around.

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