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136 Comments
- nahsrocketeer75, on 05/12/2009, -3/+80Not a chance. As soon as things start to perk up a bit we'll all (OK, most of us) go back to spending like drunken sailors.
- edstate, on 05/12/2009, -1/+50Maybe. But we ALL should be. ALL the time. If more of us were penny pinchers, or even "dollar pinchers", we probably wouldn't be in this situation.
I'm not talking about being a crazy coupon-clipping stick-in-the-mud, but...
I grew up with two (divorced) parents who were both absolutely horrendous with money. ...And, right now, my wife and I are the ONLY couple we know who have ZERO debt, a damn-decent "rainy day" fund (9 months of rent, liquid) and a good handle on all our stocks and retirement funds. We don't make big salaries by a long shot, but we manage our money ourselves, and pay estimated quarterly taxes, keeping the interest the IRS would've otherwise stolen. We don't "skimp" on much at all, but we don't buy stupid ***** either, and we only go on one "big" vacation every year (and a few smaller, extended weekend ones). We do a lot of research on big ticket items, and look hard for the best deal before we buy. And then we DO use a credit card (for the points, or whatever), and pay it off instantly. We don't eat out a lot, but when we do we have fun; probably a couple of times a month. We only use our bank's ATM machine to avoid all fees. We DON'T buy bargain-brand items (unless they're as good or better quality), but we DO keep an eye out for deals on the good stuff. And while we don't use coupons a heck of a lot, we certainly pay attention to the price of things, and even will visit a few different grocery stores to make our shopping dollar go further.
Yeah. We're "penny pinchers". And we're damn proud of it :P - GeorgeWKush, on 05/13/2009, -1/+21That's not penny pinching, that's basic money management. Penny pinching is buying the ***** toilet paper to save 50% even though you use twice as much.
- smashblu, on 05/12/2009, -0/+18I agree as well. But responsible people, who were saving as much now as they were before the downturn, will continue to save. These same people are also SPENDING and therefore fueling the economy when everyone else is afraid to.
- hyderalamgir, on 05/12/2009, -5/+22I wouldn't trust economists to factor in human nature
- falstaff, on 05/13/2009, -1/+12This is what they said about gas usage at this time last year. So I predict the "permanent" penny pinching will last about 8 more months.
- twalsh36, on 05/12/2009, -3/+14I think we might finally realize that keepin' up with the jones's aint all it's cracked up to be. We'll see...
- inactive, on 05/13/2009, -0/+10Penny pinching hell....we are saving for hyper-inflation!!!
- avataros, on 05/13/2009, -1/+11We WOULD, We COULD, We SHOULD.
But we WON'T.
Does this prediction surprise anyone? - quirkopatra, on 05/13/2009, -1/+11I can tell you that I have family that remembers the great depression. That family member, even now, owns ZERO credit cards.
- entropymaker, on 05/13/2009, -0/+9My problem is not being a "penny-pincher" but simply not having enough pennies to pinch. I'm a reasonably intelligent individual 30 yrs. old making 11$ an hr as a supervisor at an incoming cable tech support call center. I dont even own a car and yet I can't seem to keep the money in hand. I don't have a degree because I already racked up 7000$ of school debt , which I can't pay, and am not really wanting to rack up anymore school debt. The town I live in has little to nothing in the way of open job market opportunities. It seems everyone I know who has a good job got it because they know someone in that field. I'm rather depressed a lot at the lack of jobs. I could move.. but with what money? and wouldn't the same be true anywhere i move? Not knowing anyone, working some dead end job. jesus
- seattlegirluw, on 05/12/2009, -1/+10I completely agree!
- Arkons24, on 05/13/2009, -2/+10Not a chance, if anything we will become more reckless - the government is making sure of it. Less penalties for defaulting and the free and steady flow of freshly printed dollars and tax payer money will if anything simply spur on Wall St. to be even more free with credit than before.
Think of it this way, every dollar that the government gives to the financial industry is a dollar that they take out of your pocket (either through inflation or bailout). Then they take those same dollars and lend them back out to you for a price. Great system right? You get the same amount of money as before (or more depending on how reckless you are) and you only have to pay a small price for it. But if you take too much money and can't afford it you can just restructure under 363b and you don't have to pay ***** back. IT'S AMAZING! - MrFunStuff, on 05/13/2009, -2/+9You mean expect inflation because of how fast we are expanding our money supply.
- Ebacherville, on 05/13/2009, -0/+7I know idiots that still are living off debt , both husband and wife working two jobs to support there credit card bills, and still buying designer clothing and spending cash and debt like it going out of style.. Buying new vehicles, then complaining they only get 15mpg after they buy it.. yet they go buy another similar new car with as bad of milage... There idiots and sadly i see these type of people all around me.. its actually kind of scary.. they don't use that thing in the skull ever..
- marx2k, on 05/13/2009, -0/+7Yeah gasoline use trends are funny. And by funny I mean predictable and ultimately sad. At this time last year, SUVs and non-commercial use trucks were a rarity around here. Now they're back in full force. Consumers in general have a very, very short term memory.
- marx2k, on 05/13/2009, -1/+8So what do you consider smart people who figure out how to earn more money while pinching pennies?
- Nairebis, on 05/13/2009, -1/+8I have a friend who is the ultimate penny pincher. The man is CHEAP. Looks for deals everywhere. Doesn't have cable TV. Economizes wherever he can. He works for Honda at a modest salary. He's in his 40s, has a wife and two kids. The wife works part-time.
He's also a millionaire. Purely from saving and investing. He has a couple of houses that are rentals, and they're totally paid off. In Southern California, I might add.
I used to kind of laugh at his cheapness, but not anymore these days. And it's not like he's lives in a shack or lives a pauper lifestyle. He lives in nice, though modest house that he fixes up himself. The kids do sports and they vacation a couple times a year. He's just very, very, VERY frugal.
I've actually started really cutting back on my own family's expenses. You know, there really is a lot of crap you just don't need. - L0cKe, on 05/13/2009, -2/+8This is only the beginning.
- edstate, on 05/13/2009, -0/+6Technically, you're right. But it's sad that I don't know any other people who even do half of what we do... and it's not like we make a big deal out of it. It's just second nature. Basic, as you put it.
- MidnightTide, on 05/13/2009, -2/+8This entire article fails in assuming that the recession is starting to lose its grip. Its not, the government with its massive spending has just made it appear that we are coming out of the recession (lets all be honest, the depression - does anyone believe in the numbers the government is throwing out there?)
The entire system is flawed in basing the economy on consumer spending and an ever increase in the supply in credit. Credit card defaults are still rising, more and more people are getting laid off and expect more foreclosures this summer - and with the dollar starting to weaken, I expect the PPT to throw a monkey wrench in the DOW yet again.
People need to realize all this economic trouble is a market correction - did people think the party was going to last forever - after ever kick ass party comes the hangover (and we have been having this party for decades, the hangover is going to be a bitch, and all this government intervention is going to make the hangover even worse) - shujin, on 05/13/2009, -3/+9America is a consumption based economy. Make of it what you will.
- inactive, on 05/13/2009, -0/+5Depends on how bad things get. Without sweeping changes to the financial system and manufacturing/trade policy in this country we are totally screwed. Wages will keep falling and we'll continue our course towards a 2 class society.
- chupavacas, on 05/12/2009, -4/+9That's what happens in deflation. We've been hoodwinked by the Fed's artificial low interest rates into thinking that it was ok to "spend like drunken sailors" but reality has a way of correcting even massive government intervention. Expect more deflation for a long time to come because government and the Fed can't stop the hemorrhaging and the more they try, the worse they make it.
- jasdf, on 05/13/2009, -1/+6So true, I have always been a saver, the "recession" has not changed my habits at all.
- RIPtechtv, on 05/13/2009, -1/+6I don't think so. My dad told me about how bad the early 1990's and the recession of 1981 that people went back to the old ways fairly quickly.
- mah2cent, on 05/13/2009, -0/+5If the Fed keeps printing money out of thin air, the currency's value will continue to drop in terms of buying power. The result of this will be much higher prices and maybe hyperinflation ala Zimbabwe. This could happen if the world loses faith in the dollar and begin to substitute other currencies for international settlements, as China and Russia have been suggesting. They are already pulling back on purchases of US debt leading the Fed no choice but to monetize debt with printing more money. If inflation really kicks in, no one will want to hold dollars and will try exchanging them for any thing of "value". After all, money is nothing but a medium of exchange. We could even end up in a barter economy.
- tim1987, on 05/13/2009, -1/+6I just don't understand all of this penny pintching nonsense. I just tried it a minute ago and I seriously injured my fingernail.
- bipolarruledout, on 05/13/2009, -0/+4The irony is that the more money you have the more greedy/frugal you become. The top brackets don't spend 30%+ of their income on a mortgage.
- scecilio, on 05/13/2009, -1/+5"We must all wear sheets instead of buying clothes that use detergent. Instead of cars that take gasoline we can get around on llamas from Drake's farm. Instead of video games that take batteries and software our kids will play with squirrels. We must let the economy know we are capable of respecting it. No more needless spending!!!.. The economy is our shepherd. We shall not want." - Randy Marsh
- bipolarruledout, on 05/13/2009, -0/+4Take it one step further and it looks like it's more about power and concentration of it via debt.
- jasdf, on 05/13/2009, -1/+5Never...That is the name of the game for most people, even if they don't consciously know it.
- zach382, on 05/13/2009, -1/+5Penny pinching is buying the double layer toilet paper and then unwrapping it, splitting it apart, and then re-wrapping it on an old roll.
- Geheg3D, on 05/13/2009, -1/+5GOD I hope so, savings is vital to have a growing economy.
- PeeEqualsNP, on 05/13/2009, -0/+4Glad to hear your financial wisdom is paying off. From what it seems to me, most of America's problem is partly due to a misconception in financial situations. They think you have to be "rich" before you can save and invest in a 401k. But that is simply not the case. I think a lot of Americans' problems is also lack of information.
How do you start to invest? What are the details behind credit cards? Whats the difference between an FHA mortgage and a conventional besides the fact I can afford one and not the other? What's a balloon payment? What's a mutual fund?
These are the questions that it has become apparent our countrymen (and women) don't really know the answers to. They can give you general answers, but they don't really know the concepts or they just ignore the concepts of debt vs savings. Of course it doesn't help that our government supports debt and always tries to make it easier for people to go into debt.
There are several classes people can take to get this NECESSARY information in order to make better financial decisions. I've taken a Dave Ramsey "Financial Peace University" course and even after Econ 101 and a financing course in college, I still learned a lot of VERY useful information. That course does have a Christian based tie-in, but 90% of that course is agnostic, just basic financial common sense that Dave has packaged and made it easy to learn and apply. Mint.com also provides a lot of information for getting your financial situation turned around. Google "Financial Planning" or any combination of those words and others and you get tons of results with financial tips. I'd recommend the Dave Ramsey course to anyone (Free if you dont want to buy the materials, usually offered at churches but sometimes not). But there are several other classes that don't have any religious input that people can take to get the information they need.
This is part of the reason that I don't agree with the stimulus spending bailing out people (or businesses) who are being foreclosed on and discussing bailing out people who fell victim to credit card debt. Ignorance is not an excuse for bad decisions. - VassilaZaitsev, on 05/13/2009, -1/+5Rent eats up the most of a persons income,then food,cell phone,car insurance and a movie once a month,all this ***** rhetoric about everyone buying expensive bling bling is just an easy out for a screwed up economic system that drains away so much and gives little back.
You notice more stores closing not because consumer consumption has dried up totally, but because the greedy corporate landlords still overcharge for a $3000 small storefront,with no way to make any profit after paying off the rent.
Business owners have to work three weeks out of the month just to pay off the rent,insurance and taxes.. - wilf_brim, on 05/13/2009, -1/+5One can only hope. So much of the "prosperity" of the last 20 years was based on unrealistic spending and borrowing that is unsustainable.
- inactive, on 05/13/2009, -0/+4I've always been a penny pincher for the most part, so nothing has really changed for me. I blame my Jewish side.
- ProfessorRiffs, on 05/13/2009, -0/+4I always have been.
- HappyScrappy, on 05/13/2009, -1/+4We weren't before?
Wal-Mart (and China) made a truckload of money on Americans willingness to drive all the way across town to save $0.03 on a bag of M&Ms.
I think the recession has more encouraged people to spend money wisely (i.e. buy less stuff you don't need) more than anything else. - siszam, on 05/13/2009, -0/+3If being in debt, buying things you can't afford and paying interest is "with the times" no thanks. Enjoy your slavery Mofuggin.
- bipolarruledout, on 05/13/2009, -0/+3Only the ignorant would digg this down.
- MofugginPaulrus, on 05/13/2009, -1/+4That's dumb. Economics is the study of human nature in action. It is a science. It's based on empirical evidence.
- anenokoji, on 05/13/2009, -1/+4Rich people don't spend their money, thats why they got rich. And that's why people who go from broke to rich really quickly go broke immediately as well(musicians/sports figures).
You just have to be patient as it'll take a while for the pennies to add up to a maybach. - Griff431, on 05/13/2009, -1/+4I think a number of us have become a bit more aware of our spending. Sites like Amazon an such have really taken off, and a lot of people (including my parents who NEVER buy stuff online... they dont trust crap about it...) have started to use it regurally. Instead of getting it in the store, a lot of people think "I bet I could get it cheaper online."
- siszam, on 05/13/2009, -0/+3Hey, there's nothing crazy about coupon-clipping. It's crazy to pay fifty dollars for groceries when you can pay twenty.
- lukas88, on 05/13/2009, -0/+3I'd be willing to venture that people are a little less materialistic due to the financial rough period. I remember the economic depression right after 9/11 causing a lot of emotional stress. I didn't see the same reaction this time around, even though it was worse. The general mood seemed to be "yeah, we are not as rich, big deal."
- duniyadnd, on 05/13/2009, -0/+3Bull.. I already see the rents going up in parts of my area.
- mashupXXL, on 05/15/2009, -0/+3False premise. Not being idiots and living within your means is not penny pinching. Penny pinching is saving and counting every penny, sometimes even lowering your standards of living when you don't need to, to save money.
- Khiva, on 05/13/2009, -2/+5Neo-classical economics is founded on the presumption of the rational actor.
I don't see how that presumption can survive five minutes of Fox News. -
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