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Frugal: the new F word

Frugal: the new F word

What I’m reading
Some stores are scrapping self-checkouts.

Only 10% of US workers have the “optimal” characteristics to to save well for retirement.

“We frequently overestimate just how much happiness money can buy.” The pay raise people say they need to be happy.

Ranking streaming services by cost increase.

What I am thinking
I find many things come down to the fact that words can have different definitions. For example, I have discussed how people who dislike the term FIRE often choose to focus on the early retirement piece and not the financial independence piece. Same goes with people who say there is no such thing as “dividend investing.” Well, the term has been defined by the people who use it, so of course there is.

From what I can see, no word has been more maligned in the personal finance community than the word frugal. Let’s check out some history:

frugal (adj.)
“economical in use,” 1590s, from French frugal, from Latin frugalis, from undeclined adjective frugi “useful, proper, worthy, honest; temperate, economical,” originally dative of frux (plural fruges) “fruit, produce,” figuratively “value, result, success,” from PIE root *bhrug- “to enjoy,” with derivatives referring to agricultural products. Sense evolved in Latin from “useful” to “profitable” to “economical.” Related: Frugally.

PHEW. There is a LOT going on in there! What’s interesting is that on that page there is no mention of the word frugal being aligned with the word cheap but yet, it’s what frugality has come to mean to a lot of people. I think we’ve done the word frugal dirty and I am done with it!

Clearly, I consider myself a frugal person but I don’t consider myself cheap. To me, spending judiciously is what I think of when I think of the word frugal. I also think the word applies to more than just money: I want to get the maximum enjoyment out of things I spend time and energy on as well. I don’t watch a lot of movies or tv shows because I get very little value out of them. It isn’t a judgment on whether or not movies/tv are a good use of time, it’s about how I want to spend my time. I have a friend who loves movies and gets a ton of value from hitting up a theatre a few times a month. She loves it. She also loathes cooking, so she spends as few hours as possible in the kitchen. I love to cook, so I spend a lot more time cooking from scratch. We are both using our time on the things we love. That’s being frugal with our time and energy.

The same goes for your financial picture: spend money consciously on the things you love and you will get great value out of spending that money. Conversely, reaching for that credit card mindlessly every time your brain decides to have a dopamine hit for funsies and you end up broke with no money to spend on things that truly bring you joy.

Of course, people will say that frugal people focus too much on small things and ignore the larger things eating into their budgets. In some cases, that is for sure a fair assessment. For example, the easiest way for me to set up a Registered Disability Savings Plan (RDSP) was to set it up via a brick and mortar bank that had limited investment options (mostly high-fee mutual funds). It fills me with dread to know that I am paying management fees out the wazoo because of this limitation. But, the Canadian government matches my contribution 100% and those amounts grow tax free. So even with the high MER, I am still ahead. Unfortunately, many online banks don’t even offer the RDSP because there aren’t enough clients for them to deal with the hassle. Next year will be the last year that I will be eligible for the matching grant and while I hope online banks (*cough* I am talking to you Wealthsimple!) get into the game, if that doesn’t happen I will intensely research options to switch banks so I can whittle away at those crazy fees. The big things DO matter a lot – especially compounded. Large purchases such as cars, using a financial planner who takes a % of your investment, buying a home, the career you choose etc. can mean big gains and losses over a lifetime. It makes complete sense to focus on these things first.

I would argue though that making frugal choices in your everyday life also builds up your frugal muscle. Frugality becomes a habit and it contributes to your overall financial health. I am not saying that you should drive 20km to save .20cents on OJ – by definition that isn’t frugal at all! But if you shop at the grocery store near your house it takes a few short minutes to take a look at the sale items and think about buying those things and incorporating them into meals this week. It’s way better to plan ahead than end up buying a bunch of food you bought when you went to the grocery store with good intentions (or worse! Hungry!) and it ends up rotting in your fridge.

Also, most of us start our lives not making a whole lot of money. What we do have we have to use wisely if we want to balance getting our bills paid with being able to, say, have a social life. When you have less, you need to plan your money as carefully as possible. Because all the big things in your life are probably already as low as they can go you need to start cutting ruthlessly in other areas. The same goes for people who have lower incomes: telling them to not sweat about the small stuff is terrible advice when the small stuff is contributing to their inability to manage their finances and is increasing their debt. These people need to learn the skills of blackbelt scrimping until they can breathe again.

I spent years being ultra-frugal and making cutthroat decisions in how to spend. Those years allowed me to start a small business – and then to subsequently give up that business to stay at home with my kids. We rarely ate out, we mostly did the free activities available around the city and we had a YMCA membership that gave us access to fun sports classes for the kids. Most of those things were also walking or biking distance from our house. We had a really good life because we were able to access a lot of low-cost, fun stuff.

That frugality also came in handy when I decided to go back to work. Being able to live off one salary allowed me to wait and take contracts for work that I enjoyed and that were at a higher salary. I didn’t have to take the first job that came along because I knew that while the money was nice we didn’t need it to survive. I doubled my salary and went from a low-level admin position to heading up a team in a high-level position in under 5 years. I was free from the constraints of having to scramble for work to keep our family afloat. That kind of freedom to pursue the type of work you want to do is worth a lot more than eating out and shopping a lot.

Our house is paid off and our incomes is more than enough to spend well beyond what we need. But with my diagnosis it has been abundantly clear how precious time is. So while we could be buying up everything our little heart’s desire, we are choosing instead to invest Mr. Tucker’s salary to buy him an early retirement. Thankfully, my disability income is more than enough to support our family – if we spend judiciously. Buying his time back is the most frugal thing we can do right now.

In the end, frugality is a skill that never leaves you. You can also administer it as much or as less as you want to depending on your circumstances. If you have little money, you will have to tighten your belt. If you have a lot of money, you can loosen the belt if you’d like. But it’s exactly like riding a bike: you never forget how to use it.

Credit cards and teenagers

Credit cards and teenagers

What I am reading
This is strangely sad: Aardman studios – makers of Shawn the Sheep, Chicken Run & Wallace and Gromit – is apparently running out of clay. EDIT: apparently it is transitioning to another supplier. PHEW!

“I wanted to understand: what kind of human spends their days exploiting our dumbest impulses for traffic and profit? Who the hell are these people making money off of everyone else’s misery?” Did SEO experts ruin the internet, or did google?

Wages are high. Jobs are plentiful. Nobody’s happy.

The case for inviting everyone to everything. I often dream of having a GIANT pool party and inviting everyone I know. Why not get to know each other before my funeral?

Morgan Housel on the full reset. I have been doing our budget for the same way for years so maybe Mr. Tucker can take a stab at a new one for 2024?

What I’m thinking about
I am letting the kids go shopping for winter clothes tonight. They are going to meet at the mall and go shopping together. The Eldest needs a winter coat and The Youngest needs new boots. I set down a few rules around budget and type (ie: they have to be waterproof winter boots with a lining, the coat must be for winter) but they are free to get the style they want. In order to do this, The Eldest will pay on her credit card.

I got The Eldest her own credit card when the kids went on an oversees trip with a relative. I was scared that they would end up getting stuck somewhere without money. It’s also been handy because it’s allowed her to make her own purchases (that we’ve agreed to) for things like back-to-school shopping and the odd lunch at school when she forgets hers. Next year when The Youngest turns 14, they too will get their own credit card. (I also want to set them up with an Uber Family profile for the exact same reason but unfortunately I haven’t been able to get that to work yet.)

To be honest: I can’t say if this is a good idea or a bad idea long term for teaching them about credit cards. I just know that as a mom with two kids (who will be in two different high schools who will go out with friends and who may ended up stranded somewhere) it makes me feel better to know that they have something to pay to get them home.

What I have done is that when The Eldest wants to spend money before she’s earned it, I let her use the credit card – with a catch. On Saturday she decided at the last minute to hit the mall with her friends and asked me if she could spend the money she would have earned on Sunday doing the housecleaning & just use the credit card. I said yes – but that she would have to “pay interest” by taking a lower amount of money than what she would get if she waited until after the work was done (payday loan style – but less aggressive). She agreed to the lower amount and happily went off to spend the rest at the mall with her friends.

Now some of you are thinking that this is horrible, some of you think it’s great and the rest of you think I probably should have made the amount higher if she so readily agreed. Overall though, I am pleased with giving her the options and allowing her to make the choice. I haven’t figured out how to navigate the actual management of a credit card as she transitions into adulthood and needs to manage her own budget. What I do know is that I plan to get her there before she encounters the predatory credit card offers with the “free gifts” that are ubiquitous all over student commons’ everywhere (if she even chooses to go to post-secondary).

She did ask me if they could buy dinner at the mall, to which I said no (we’ve eaten out too much this month) because we have food at home – the rallying cry of mothers everywhere! But I did agree that they could get a bubble tea when they were done shopping, as a little treat (hah, the irony is not lost on me).

People like good news about their bad decisions

People like good news about their bad decisions

• I absolutely adore Katherine May’s books and have bought myself a copy of Wintering to re-read during the dark days ahead. Her newsletter is a lovely read about how to feel grounded in turbulent times.

• I’ve long been a big fan of alternative housing which is funny for someone for whom accessibility is a top concern. Still, this is a good piece about living on a boat. I wish it was more of a choice for many people

Which cities have bubble risk in their property markets?

A dollar is a medium of exchange, not a store of value. Some great points here!

• A great non-fiction-ish short story on the real costs of inflation in business and life.

People love good news about their bad decisions
This is why things like Girl Math and Little Treat culture gain traction on TikTok and other social media sites. It feels good to get confirmation that your decisions are in line with the decisions of others. We are, after all, a tribal species.

Unfortunately though, all of these videos and commentary from influencers has very little application to your own personal situation. As the adage goes in personal finance: the only person who cares about your money is you. It doesn’t matter how many videos you watch extoling the virtues of getting a “little treat” in the form of an $8 latte a day if you are miserable because you are sinking in debt – and you don’t even enjoy the latte that much. You need to take a look at your own situation and decide whether or not certain things have value and make you happy. Ignore the noise from the internet telling you that you can ignore any purchase under $5. It’s just “girl math!” What they aren’t telling you is that $5 once a day is $150 a month.

I think the challenge is when a treat becomes, over time, a habit. No one can decide that line for you but if you truly enjoy eating lunch out every day to the tune of $15 a day, then that is probably something you can decide to keep. But if it means you’re upset that can’t afford to go to a fancy dinner with friends because you’ve blown all of your spending money, then maybe review that habit. It’s on you to make those choices and no one else can make them for you.

Yes, there are systemic challenges that are happening and we should all be pushing for change. There is a housing crisis, a recession looming, pensions have gone the way of the Dodo and it can be easy to throw up your hands and say, “screw it, I am going to make myself happy today.” If you choose to do that, who am I to stop you? It’s your life. I am not going to judge. In fact, I don’t care at all. The only person who cares about your money is you.

I see so many people bemoaning standard personal finance advice,

“That wouldn’t work for me!”
“I don’t want to give up my lifestyle!”
“I need X!”
“That sounds like deprivation to me!”
“We need two cars!”
“I can’t eat leftovers!”
“I deserve this for working so hard!”
“Why bother saving, I’ll never be able to afford to buy a house/go on vacation/retire.”

You know what? You are absolutely right. Please carry on.

Do you think Dave Bach or Suze Orman give two shits about what you do with your money? No. They’re busy rolling around in the piles of cash because they’ve been on the personal finance scene for forever and a day spitting out books, getting speaking gigs, plying their trade. All your criticism of typical advice to get your financial affairs in order doesn’t matter one bit. The truth is, it’s very basic and it works. The info they’re peddling isn’t even new or revelational: they are saying the same stuff that you can read on the internet for free any day of the week.

Pay off your debt.
Live below your means.
Save the rest.
Have money in the bank for emergencies.
Save money and invest it long term.

You can bitch and moan all you want that it’s hard, or that you feel judged or that it doesn’t leave you much room for fun things but all it is, is information. You can ignore this information, or you can use it as a springboard to change your life. No one else cares.

Money lessons, learned?

Money lessons, learned?

As a parent, as you raise your kids you just have to cross your fingers and hope that they got the lessons and will apply the teachings to their lives. You know that not everything will stick and you also know that some things have to be experienced, not just told to you. It’s a lot of work for not knowing the outcome.

Since the eldest has started her first job, we’ve done our best to give her financial advice in a way that isn’t too finger-wagging but that still encourages her to plan for saving and future spending. She luckily was given three permanent guaranteed shifts, three days a week, or 25 hours. It’s a perfect way to start your first job, in my opinion. Since she’s started though, she’s realized that she can also pick up MORE shifts and that MORE shifts means MORE money. So she got out a calculator to figure out how many shifts a week she could reasonably work. Bless her heart!

Also, because the city has had such a hard time hiring and retaining staff, they’ve also changed their NO OVERTIME policy and are allowing the wading pool attendants to get time and a half for every hour worked over 44 hours. So the eldest got her calculator out again and figured out how much she could make in a week.

Off to her first day of work

Of course, I don’t want my 15-year-old to work over 44 hours a week but I think the process is valuable. It makes her calculate – and evaluate – how much time she wants to trade for money. I think she also thought that her friends would be around much more than they have been this summer. Many of them have cottages or have gone on trips so her off time is generally spent playing video games & staying home. I think that is what has prompted her to pick up as many shifts as she can: she really wants to save enough to spend during the school year, when her friends are around and they want to go out and do things.

I would be lying if it didn’t warm my cold, goth heart when she called me into her room to tell me about the financial plan she had worked out based on a theoretical amount of shifts she can pick up over the next 5 weeks. She had stuck to my 50% long term savings, 25% short term savings for the school year and the 25% spend now plan! I was super proud of her even though I only said she had to put X amount into long term savings – she decided on her own to save more!

Of course, I did tell her that she should take her first pay and spend it all, as a treat for getting her first job. She ended up getting paid and taking her sister to the mall with her so she could pick up a few things. Sure, she spent money on things that I thought were useless but we all spend in ways that other people wouldn’t! She also kindly bought her sister a cute sweater.

What I found telling though is that the eldest also decided to buy them both lunch at the food court while they were there. When she got home with her spoils she confided in her dad and I, “I wish I hadn’t bought the fast food. It was $30 – two hours of work – and it wasn’t even that good! Oh well.”

Lesson learned, indeed.

My kid got her first job

My kid got her first job

Mr. Tucker and I both had pretty shitty first jobs. He worked in a camp for a stipend (which is really a volunteer position) when he was a teen but his first “real job” was in fast food. My first job was at 13 at a downtown restaurant with a takeout counter. When I was 14 I switched to working as an overnight busser on weekends. It was one of the two only restaurants that were open 24 hours so since I worked the weekends it was…not ok. Although the late 80s and early 90s were a different time, looking back on it an underage kid should not have been exposed to so many drunk people and their inability to keep their hands to themselves. Mr. Tucker also worked in a west-end fast food place after the bars closed and it was challenging in similar ways, mostly fights.

While I truly believe that everyone should work a shitty, low-paying job at least once in their life, I don’t necessarily think that should be your first job out of the gate. In fact, I think my most hated job (next to the ONE day I did telemarketing) was in a big box craft store* (yes, that one).

So when it came to the eldest, I decided to stack the deck in her favour. Because she loves skiing so much and has aged out of the lessons, she took her first ski instructor course this winter – and passed! So now she is a certified Level I Ski Instructor and she hopes to get hired at a local hill next season. I had also heard that the city was looking to fill a bunch of lifeguarding jobs, so she started down that path last fall. At 15, she now has her Bronze Medallion and Standard First Aid with CPR-C. This got her an interview – and a subsequent job offer – to work for the city this summer! Although I saw that you didn’t need experience in anything, it did recommend that you have some lifeguarding training and SFA/CPR was a requirement.

The eldest is blasé when it comes to continuing lifeguarding courses but at the very least what she does have has helped her get a job where she gets to spend all day out in the fresh air all summer. It’s also a job where there aren’t early mornings/late nights and it is more family-oriented (which doesn’t mean NO challenges but certainly reduces the potential to be around drunk, handsy people). She will also be placed in our general area of the city, which means she can probably bike to work which will also be great exercise.

My goal for both of the children is to get them to 16, pay for Driver’s Ed, pay for them to get their driver’s license and then set them freeeeeeeeeeeeeee to pay for the things they want after that**, by which I mean no more allowance.

I did sit the eldest down and drew her this fine sketch:

Behold! My incredible art skills make charts come to life!

I then told her that her first week of pay should be one of celebration: celebrate getting your first job and spend a week’s worth of earnings on buying things that she wants. But after that, it’s time to buckle down. I suggested that she budget:

50% to long term savings: this amount will go into a high-interest savings account for when she is unemployed or if she is in university and needs money to go out, buy herself things etc. Also, she knows that we have enough for a local school but if she chooses to go away for university she will probably have to chip in.

25% to long term spending: this is the money she can put in a savings account for the fall when she is in between jobs but still wants to go out and hang out with friends. Essentially, she will need to spread this amount over 4 months from September to December until she is working again in the winter. It’s basically teaching her to budget & monitor her spending so that she doesn’t run out of money.

25% to short term spending: this is the amount that she can spend free and clear every pay without having to worry.

In this example, I gave the example of a $500 paycheque to illustrate how she would divvy it up.

Do I anticipate that this will go 100% smoothly? I do not. BUT she at least has a game plan in mind and a goal to try and achieve when the stakes are relatively low. I feel like teenagers are kind of the perfect audience for this kind of budget teaching: they will test the waters and (most likely) find themselves coming up short. But they will learn the lesson and take it with them all through their financial journey. Like anyone, they will need to actually experience the highs and lows of money management until they figure what works for them. All you can do as a parent is teach the lesson, give them encouragement and support (not judgement) and hope that remember the lesson when they need it the most – when the stakes are higher.

She is eager to work as many hours as she can this summer but we will see what happens. Either way, it’s another milestone on the way to adulthood!

Filling out the ubiquitous onboarding forms – get used to this, kid

*I should have known that they’d be awful when “training” consisted of watching an anti-union video. They consistently understaffed and overworked people and the final straw for me was when they scheduled me at the same time that I had requested off to take a university exam. I walked out.

**Clearly we will still pay for clothes, food, shelter, education etc.

Is there a “Singles Tax?”

Is there a “Singles Tax?”

How the ‘tax’ on singles has people who live alone feeling the pinch

Economies of scale are clearly cheaper to manage, so in one sense: yes, there is a singles tax.

But reading through this article, the thing that really bugs me is this idea that “someone should do something” when people aren’t helping themselves. Jenn could get a roommate to reduce her costs or even get rid of her car as she lives in an area with great transit. But instead, she’s complaining about the high cost of living in the urban core.

The thing is, to live in an urban core we need to accept smaller spaces. When I was in my 20s and early 30s I always lived with roommates. We split the bills and sometimes even split food. It never occurred to me to live alone because even when rents were way cheaper than they are now, we didn’t want all of our money being eaten up by rent.

Then when I met Mr. Tucker we moved into a 510 square foot condo with our dog. It suited us just fine and got us out of the house for walks 3x a day and we spent an hour at the dog park every night after work – rain, shine or snow. We also walked or used public transit because owning a car in the city is just ridiculous. We did consider car-sharing companies but we didn’t follow through. Unless you were leaving the city on a trip, almost everything could be found in an urban centre and if we needed something outside of that, we just took cabs.

From the article:

“The average one-bedroom is now $2,458, according to a national report from in February. An apartment with a little more room and some backyard space for the adopted rescue mutt she dreams of would run her closer to $3,000 — and that’s a hefty price tag for just one person.”

In that same report however, a 2 bedroom would cost $3324 – or $1662 per person AND she could get a dog – if she got a roommate (who likes dogs). It is just flabbergasting to me that she lives in 595sq ft and is whining about how hard it is even though she has clearly not considered any money saving alternatives (get rid of the car, get a roommate who likes dogs and rent a larger place for cheaper). I respect if she chooses to live alone because she doesn’t want a roommate but she needs to own that choice and not complain about it.

There is the fundamental issue that I feel people in Canada and the US haven’t come to terms with: you are not entitled to have a lot of living space at a low cost in a great area. Of course, we all want this but it isn’t feasible because…we ALL want this!  But in order to make livable, walkable cities we all need to make concessions and one of those concessions is space.

In 1910 the average square footage of a house in the US was 800sq ft and now they are 74% larger. The average size now is $2430 sq ft. Our expectations are higher now than they’ve ever been and we want these homes at a low rate. Our expectations are really entitledness at this point.

For a comparison, our last home was 1200sq ft and our kids had to share a room because Mr. Tucker works from home and he needed an office. Our current home – a midcentury modern – is 1300sq ft and has a partially finished basement with an office and a rec room, which probably brings it closer to 1900sq ft. The bonus here is that we now have a powder room and both kids have their own rooms.

While I am coming down hard on people’s expectations when it comes to housing, there is a definite truth when it comes to food. Grocers do reward multiple buys of products which could lead to people buying things they don’t need and just letting the extra go waste because it’s cheaper. I also sympathize with anyone who is raising kids or taking care of a loved one on one income. Those are definitely challenges that need myriad policy-driven approaches.

In Canada at least, the government could get back into the affordable housing business again. This is not a party-specific issue, either: multiple governments have ignored housing issues for the past 20 years and the clever solutions that all levels of government are proposing aren’t clever at all and in many ways are increasing the problem. On top of that, we are poised to let in more immigrants over the next few years without even knowing where they’ll live.  While I definitely support the move, we need to think of how the infrastructure of this country will handle the influx.

What I think we need to accept is a tempering of our own inflated expectations. We are trying to live in a Friends world on a Roseanne budget. For our finances, our cities and our resources we need to look to places like Amsterdam with its great public infrastructure and to other European cities where they’ve normalized smaller spaces and where car ownership is just so incredibly expensive that everyone is invested in public transport and public spaces. Urban sprawl is not the solution to this issue, learning to live with less, is.