This is Day #19 of “25 Days to Healthier Finances”, a series of blog posts where Frugal Pinoy readers and myself work on 1 task a day to make our financial lives better. Please stay tuned for the next installment of this series, which will be up tomorrow. Here’s today’s installment:

Today’s Task: Quit an expensive habit.

We all have habits. Some of them are healthy while others can be destructive if we do them mindlessly. The truth is that some habits have negative consequences on our finances. While we can live with most of these consequences, there are some cases where we can’t afford them. Here are some examples:

• That (almost) daily morning coffee.
• Smoking.
• Going shopping as therapy.
• Sending forwarded text messages to your entire contact list multiple times a day.
• Dining out with family or friends during payday.
• Buying lunch from fast food chains rather than bringing your own lunch.

But how do you quit a habit? The first thing you should try is to figure out how much it’s costing you. How much do you spend on that habit per week? Per month? Per year?

After doing the math, find out if your income allows for this kind of expense. For example, when I was still a student, I noticed that I bought bottled water and other drinks each day during lunch. This cost me P30 per day, and since I was usually at school 6 times a week, this seemingly minor daily expense cost me at least P700/month. At that time I was probably earning only P9,000/month since I was just starting out as a freelance writer. I was also the breadwinner, which meant that the P700/month was more than I could afford for something as simple as water. Realizing this, I just brought my own bottle to school every day and refilled it at the water fountain.

If your expensive habit is something you can’t give up completely, then consider simply cutting back. Instead of the daily cup of coffee, why not reduce it to three times a week? Even this simple change can give you a lot of “extra” money which you can funnel into your savings, emergency fund, or an item that matters more to you.

What expensive habits do you have? Can you afford to have them?

Image by vivekchugh from sxc.hu

This is Day #17 of “25 Days to Healthier Finances”, a series of blog posts where Frugal Pinoy readers and myself work on 1 task a day to make our financial lives better. Please stay tuned for the next installment of this series, which will be up tomorrow. Here’s today’s installment:

When it comes to time and money, we usually focus on the things we have to do. Paying the bills, finishing up that report, cleaning the house. While these things are important, we should be equally mindful of the things we shouldn’t do.

Today’s Task: Know the things that you don’t care to spend on.

It’s simple. Just jot down the expenses that really don’t matter to you. Here’s a short list of some things that don’t matter to me:

• Dining out
• Watching most films in the cinema
• Clothes and accessories (as a side effect of rarely going out)
• Cable TV
  

Things that matter to me:

• Books
• Good quality of food
• Maintaining a solid but beautiful house
• Hobbies such as woodworking and gardening

What does this mean? By making the list of the things that don’t matter to you, you’ll know what expense traps to avoid. For example, why would I spend P500 to try out a new restaurant when I can use that money to buy high-quality ingredients for a home cooked meal? Or, why would I spend P200 to watch a movie in a mall dahil wala lang akong magawa, when I can usually buy 5 books with that at my favorite used books store? It’s like building a list of “not-priorities”.

You can also do this exercise for a major purchase so that you won’t be distracted. When buying a new car, this may be your list of not-priorities:

• Color
• Exterior design
• Quality of speakers

By making this list before you look at cars to buy, you won’t be distracted by the bells and whistles that don’t matter to you. You won’t go “Shit, panget pala gas mileage nito, nadistract ako sa sleek, chromed-up design.” Conversely, if the exterior design matters to you the most, you won’t be distracted by sales pitches about payment terms or storage space.

When we have limited resources, we need to know the things we can “sacrifice”, and the things we don’t care about should be the first to go. That way, we know that we’re left with the things that matter.

Image by doctor-a from sxc.hu

This is Day #15 of “25 Days to Healthier Finances”, a series of blog posts where Frugal Pinoy readers and myself work on 1 task a day to make our financial lives better. Please stay tuned for the next installment of this series, which will be up tomorrow. Here’s today’s installment:

Impulsive spending is one of the more common reasons why some can’t seem to take hold of their finances. I only have to look at the blogs and Facebook/Twitter updates of my peers to see how impulsive spending is a common problem, especially among young people:

“Sweldo na naman! Kaso maauubos ko lang pambayad credit card “

“Hirap magtipid! Hirap magipon! Dapat di nauso yang credit card na yan e!”

If these sentiments sound familiar to you, read on. If you’re one of those people without credit card debt, then congratulations! You don’t have to worry about this:

Today’s Task: Carry only one credit card in your wallet.

But it’s even better if you don’t carry one at all.

So that’s it, remove all your excess credit cards from your wallet and hide them under a drawer. Or cut them up. It all depends on how deep in debt you are and how desperate you are to get out of it. Don’t just do this for today, do it for as long as you can.

Here’s a bonus task: on your credit card, stick a post-it note that reminds you to use your card less. It could be any of the following:

• A reminder of what you’re saving up for, whether it’s a house, car, or even a “want” such as a gadget or a trip.
• A motivational quote that will discourage your from using your card impulsively. Some examples:
  • “Too many people spend money they haven’t earned, to buy things they don’t want, to impress people they don’t like.” – Will Smith
  • “Every time you spend on a short term want, you lose part of a long term dream.” (I can’t remember where I got this.)
• Or just the word “Don’t” or “No!”.

This task may sound too simple or even cheesy, but if you find that it works for you, then it’s worth it. Personally, I don’t have a credit card – but I know myself well enough to predict that if I had one, I wouldn’t be as financially stable as I am today.

Image by LotusHead from sxc.hu

Today’s task is especially useful for those who can’t seem to save any money at all. If you’re already good at saving, maybe you can skip this task, but it’s still worth trying if you want to beef up your savings a bit. Since it’s a workday, I’m keeping it easy.

Today’s Task: Collect your loose change at the end of the day. Every day.

You don’t have to include the change you’ll need to pay your commuting fare to work the following day. Grab a large old jar/can and start collecting.

What for? Well, if you’re having a really hard time saving any money at all, now’s your chance for a simple solution. It may sound too simple, but maybe that’s what some of us need.

Once you fill the jar, you can convert it to bills (via sari-sari stores, any bills you have, etc.) then deposit it in your savings account. What you’ll use your savings for depends on you, but if you don’t have an emergency fund yet, you can start with that.

Image by Avolore from sxc.hu

We are all subscribers. Whether it’s for cable TV, internet service, magazines, or gym memberships, there’s always that extra something that we regularly pay for each month. We often think we’re getting a good deal or that we’ve minimized our expenses – until we review our subscriptions. So that’s what we’re going to do today.

Today’s Task: Evaluate your subscriptions.

Here’s a list of subscriptions you may already have (including the ones I listed above):

• newspapers
• magazines
• cable TV
• cellphone service
• internet
• gym memberships
• video rental shops (I’m sure a few of you still have these)
• online subscriptions (to certain apps, online tools, etc.)

Note how much you are spending on these things each month, and add up these monthly expenses to see how much you spend each year. If you’re spending more than you’d like, maybe it’s time to trim down these expenses.

Trimming Down Your Subscriptions

If you suspect you can cut back on these expenses, here are some ways you can do it:

Look for free alternatives. With major newspapers and magazines publishing their content online, there’s rarely any reason to buy the printed version. When I was a working student trying to make ends meet, I saw that my mom’s newspapers subscriptions cost us P750/month. That may seem like a small amount to you, but for someone who’s trying to support a small household with a part-time income, that’s a lot of money. It seemed wasteful to subscribe to them when I can get the same content for free (and with no paper waste too).

As for cable TV, if you find that the shows you enjoy are also aired in free TV channels, why pay for them? Unless you need the late night reruns or the latest episodes (which the free channels also show), there’s hardly a need to subscribe. If you’re a PLDT DSL subscriber, check out WatchPad, which allows you to watch some cable channels for free (if your internet provider has a similar service, take advantage of it).

Look for cheaper plans/providers. Canvass for options that allow you to get the same service at a lower price.

Go a la carte. Ramit Sethi discusses this in his blog, IWillTeachYouToBeRich. Basically, instead of paying a flat fee per month, try to find a pay-as-you-go model. Here are some ways to implement this:

• Instead of using a postpaid cellphone subscription, use a prepaid one.
• Instead of paying for a monthly gym membership, pay every time you walk in. People tend to overestimate the number of times they go to the gym.
• Buy your favorite magazines only when the covers or table of contents truly interest you.

Remember: the point is not to eliminate subscriptions altogether. It’s to evaluate them and see if there are ways we can cut back or be mindful of these expenses.

Today’s Task: Pick 2 no-spending days this month

Look at your calendar. Pick two days, it doesn’t matter if they’re one week apart or if you pick two succeeding days. Then, label these days as your no-spending days. Write it down somewhere, preferably a desktop calendar or something that you look at every day. Then, commit to it.

Sure, it’s impossible to have absolutely no spending in one day. After all, we use electricity, food, and water daily. In this case, when we say “no spending” we mean no cash out. Don’t even charge your credit card.

But what about transportation? Well, you can either pick a day where you don’t have to go to work or run errands. Or find a way to get to your destination for free (carpool, walking, biking) – as long as it’s practical. Or you can simply aim to spend less on transportation that day (take the jeep instead of a taxi, etc.).

What about food? Cook. I’m amazed when I hear about people who are college graduates and have been employed for a while yet can’t cook anything. That’s a very, very basic skill that everyone needs to learn. It’s your nutritional intake, for crying out loud. Kahit pagsaing lang ng kanin o paglaga lang ng itlog. Don’t know how to do these things? Learn. Kaya nga may Google.

Why do this at all? It’s not just about lessening your expenses, it’s also about doing a practical experiment to see what you can cut back on. It’s easy to overlook spending on daily coffee, convenience foods, and other unnecessary daily expenses, then wonder where your paycheck went. By seeing how little you can spend on some days, you’ll have a more realistic idea about the expenses you can do without. Who knows, you might end up having one no-spending day each week.

Personally, I’m picking December 5 and December 7.

Lately I’ve been thinking about what I can do to lower our energy consumption at home. We don’t have many appliances, but if there’s a way I can lower my bill and lessen my home’s negative impact on the environment, I’d love to try it. This made me consider using solar energy.

When people think about harnessing solar energy, the first thing that comes to mind are photovoltaic panels — but this is hardly the best choice.

Here’s the problem: First of all, most solar panels are not that environment-friendly. Some use a very rare metal called indium, and if we continue to use indium at our current rate, we’ll only have a 10-year supply of it left.

Using solar panels to power your home can also be impractical. You’ll need several modules or panels to produce a workable amount of electricity, not to mention the space to hold them. Plus, they are just too expensive for the average Filipino consumer.

We have to look at solar energy from a different angle, then.

Solar Ovens

One way to utilize solar energy for your home is to build a solar oven. Basically, these ovens run on nothing but the light and heat of the sun. Here are the advantages of doing this:

• You can’t burn anything. Soft vegetables may overcook though, if left in too long, but this just means they have to be the last thing you’ll add.
• It reduces your LPG or electrical consumption used for cooking, since you’re directly using solar energy to cook.
• It uses less water. Since the cooker is enclosed, moisture is retained in the food, it doesn’t evaporate. Usually, you don’t need to add extra water to your meat or vegetables.
• It’s environment-friendly. No harmful emissions and pollutants result from using this oven for cooking.

Solar ovens also have a few disadvantages.

• It takes longer to cook with a solar oven. This means it’s not a good setup if you’re in a hurry to eat. Because of this, cooking this way is only ideal for lunch, merienda, and dinner (to be reheated later). To shorten cooking time, set up your oven as early as possible and cut your meat, fish, and veggies into small pieces. If you’ll be cooking a lot of food, it’s better to use two or more smaller pots than one large pot.
• Some cookers need to be adjusted to face the sun every half hour or so. But the effort of that is minimal compared to constantly watching your meal on a stove.
• Of course, you can’t cook this way during the evening or cloudy or rainy days.

Here are some additional resources on solar cooking:

• The Wikipedia article on solar cookers provides a good introduction.
• Solar oven do-it-yourself plans from SolarCooking.org. For something large, check out the cob solar oven (PDF). If you want a portable solar oven, try this collapsible one.
• A list of common questions about solar cooking at the solar cooking wiki. (Explore the rest of the wiki. They’ve got a lot of handy instructions there.)
• Some video demos in YouYube:
  • Solar oven pot roast – the guy in this video just used two glass bowls and a large plastic screen.
  • Solar box oven cooking in the winter.  Pretty inspiring. Kung pwede magluto ng roast chicken (at 300+ Fahrenheit) via the sun during winter in Canada, paano pa kaya sa rainy season dito sa Pilipinas?
  • Stewed chicken and cornbread made via a solar oven

Solar cooking is a topic that I’m very, very interested in. By the time I start living in the province, I want to be very good at setting up solar ovens so that I can build them and give them away to my partner’s relatives there. This will lessen their LPG, coal, and other cooking expenses. (I actually made a makeshift oven based on one of the videos above. I’ll be posting about that next week.)

Natural Light

To maximize sunlight and avoid turning on light bulbs during the day, make sure that the high-activity rooms of your house have ample windows and other source of natural lighting. These rooms include the kitchen, a home office, or the dining room. It may sound like common sense, but many people forget this when planning or remodeling their homes.

Here’s an example: I’m in my home office for the greater part of the day, so I need it to be well lighted while I work or read. It’s fortunate that I have a large window on one wall and a sliding glass door on another wall – I never have to turn on a light bulb between 6am to 4pm.

Our kitchen/dining room also maximizes natural light. There are doors on both ends of the room, and both of them have a secondary screen door. Our ceiling also has two skylights made out of the typical translucent plastic “yero”.

If you have the budget,you can try installing tubular light (also known as sun pipes or sun tubes) in your house. I don’t know where to get these locally, though. Frankly, I think the other natural lighting methods I mentioned above should be enough for the typical Filipino home.

How about you? Do you have other frugal ideas on how to use solar energy? Have you tried any of the above methods?

Additional Sources:

• “Renewable Energy Solar Cells Ain’t So Renewable” by Kit Eaton, FastCompany.com

Image by flaivoloka from sxc.hu

It’s a new month again, which means that it’s a new opportunity for you to find other ways to save money. If you don’t know where you can get extra money for your savings, check out these five tips and see if they apply to you:

Have a daily quota for using cellphone credits. If you find yourself calling and texting often,  exercise a bit of discrimination when sending out messages. Avoid sending out forwarded messages the entire month. My cousin once asked me to be honest about how much I load my cellphone each week, expecting that I’d tell him a large amount. He was shocked to find out that I usually just spend P30 per month, and I almost never spend more than P90.

While I understand that there are some professionals that may find this difficult, at least try to cut back on using your cellphone for texting or calling friends and relatives. Opt for free ways to communicate instead, such as via instant messaging, landline-to-landline calls, Facebook, or email. (Of course, this isn’t applicable if you don’t have easy access to the internet, or if you need to call long distance.)

Don’t buy new clothes this month. Unless your house was accidentally set on fire or your clothes were stolen as you left them hanging out on the clothesline, don’t buy any new clothes this month. I know quite a few people whose monthly income is mostly spent on clothes shopping, and as they tell me they can’t find any money to save, I just want to slap my forehead in disappointment. Just eliminate shopping for clothes or shoes this month. It won’t kill you, I promise.

Discontinue newspaper and magazine subscriptions. I don’t subscribe to any newspapers, mostly because I just read them online. The Philippine Daily Inquirer, The Philippine Star, and The Manila Times all have online editions. Apart from the subscription savings, you’ll also have access to breaking news, and you won’t have old newspapers cluttering up your house.

I also don’t subscribe to magazines, but this doesn’t mean I won’t buy the occasional magazine that catches my eye. I just happen to be very choosy and I make sure that the content and value that I get from the magazine won’t be found for free elsewhere.

Cut dining and drinking out by half. If you find yourself going out often, such as more than once a week, cut this by half. This includes going out for coffee or lunch during the regular workday. Brew your own coffee or pack your own lunch instead. If friends invite you out and you don’t want to let them down, try my suggestions for making a gimik more affordable.

Automatically send at least P500 to your savings account as soon as you receive your paycheck. It’s wise to keep a  separate account for your savings, apart from your payroll account (as I’ve mentioned in a previous post). By setting aside your savings as soon as you receive your income, you have a lower chance of spending it.

Do you have additional money saving tips? Please share them in the comments.

Image by asterisco from sxc.hu

Instead of buying seed starter pots or seedling pots from the garden supply store, I just make my own out of old newspapers*. It only took me less than 30 minutes to make the entire batch you see below. Apart form newspapers, I also used old kraft paper.

*I don’t subscribe to any newspapers. I get all my news online. If you do the same, you can just do what I did and get old newspapers from your neighbors.

These homemade pots have the following advantages:

• You’re recycling old materials.
• It doesn’t cost anything to make.
• You don’t have to worry about root trauma when transplanting your seedlings. Just put these into the soil (or unwrap them gently) when you are ready to transplant, and the paper will eventually disintegrate.This comes in handy for plants that don’t transplant well, such as cilantro.

Here’s a video I found which shows how to make them:

Don’t buy everything from one grocery. For my family, I usually buy from a nearby SaveMore supermarket, a Parco supermarket, and Makro. Since I visit these places regularly, I have an idea about which items are cheaper when bought at a specific grocery.

Of course, this only makes sense if all the supermarkets you buy from aren’t out of the way. Otherwise, transportation costs might make your overall grocery expenses the same, or even more expensive, than if you shopped at the grocery nearest your home.

Go on fewer grocery trips. Since I visit 3 groceries, it might sound like I do my grocery shopping too often. The truth is, I only make 2 major grocery trips each month, and probably an additional 2 trips if I want to cook something special that I didn’t plan for. But for these additional trips, I only buy the ingredients I need. Generally, though, I prefer to plan for everything ahead of time so I can visit the grocery less often.

How will this save you money? If you go to the grocery less, there’s less temptation for you to buy unnecessary items that you weren’t planning to buy in the first place. Also, your transportation costs will be lower.

Compare and test different brands. Since I want to choose the brands that give me the best value for my money, I test different brands until I find “the one”. Sometimes “the one” turns out to be the cheapest brand or a generic product (such as the Savepak dishwashing liquid), sometimes it’s the most expensive brand, and sometimes it’s somewhere in the middle. But you can never know which brands give you the best value unless you try them out.

Buy in bulk, if it makes sense. In a previous post, I wrote about how to buy in bulk wisely (click here to read it). Usually, if you buy items in bulk you can save a bit of money – but only if you maintain your usual consumption rate of the bulk products you buy. See, some people tend to overuse items that they bought in bulk because “Marami pa naman eh”. Know your own habits and do the math to ensure that bulk purchases really save you money.

Stick to your list. It helps to have a list of items to buy before you go to the grocery, and to stick to buying only the items that are on your list. This prevents you from buying unexpected items on a whim. But if you find yourself looking at an item that isn’t in your list…

…apply the 10-second rule. This means that before you buy an item that isn’t on your list, think about it for 10 solid seconds before deciding to put it in your shopping cart. This will allow you to evaluate your purchase more thoroughly, rather than automatically chucking items in your cart without thought.

Use a rewards card. This is for those groceries that you’re often visiting. Savemore, Parco, Shopwise, and Rustan’s all offer their own rewards cards to customers. The rewards card will allow you to earn points for your purchases, which you can redeem in the future.

Do you have any tips to share about saving money on groceries? Please share them to the other readers via the comments section.

Image by Davide Guglielmo